Digital Ad Spending Reaches $88 Billion In 2017; 57 Percent Commanded By Mobile
In 2017, U.S. digital ad spending reached $88 billion, a new record for the category. The data comes from the latest Internet Advertising Revenue Report, published by the Interactive Advertising Bureau (IAB) and prepared by PwC. The 2017 figure represents a 21 percent increase over the previous year’s total U.S. digital ad spend of $72.5 billion, and marks the first time in the IAB’s report that digital ad revenues have overtaken television (broadcast and cable combined).
Mobile first took more than half of total digital revenues in 2016, and in 2017 grew its share to 57 percent. The IAB reports that mobile spending grew from $36.6 billion in 2016 to $49.9 billion in 2017, representing a 36 percent year-over-year increase.
“Consumers are increasingly spending a tremendous amount of time with interactive screens and content—from mobile to desktop and audio to OTT—and brands are in lockstep with a growing commitment to digital ad buys,” says Randall Rothenberg, CEO, IAB. “Mobile captured more than half of the total digital ad spend last year and we can easily expect that share to continue to climb. Video also saw significant growth. That is no surprise—especially after seeing buyers clamoring to get into last week’s NewFronts presentations in New York.”
Digital video reached $11.9 in 2017, a new record for the category and a 33 percent year-over-year increase from 2016’s $8.9 billion. On mobile, the IAB notes that digital video’s growth was even more pronounced, growing 54 percent to $6.2 billion and representing the first time that mobile video revenues surpassed desktop video.
“Smartphones and tablets have become indispensable tools in the hands of consumers, from the moment they wake up to right before they go to sleep,” said Anna Bager, executive vice president, industry initiatives, IAB. “A double-digit uptick in spend on mobile video is testament to both the pull of mobile and consumer’s never-ending demand for sight, sound, and motion—even while on the go. In addition, brands are embracing digital audio at a fast clip, recognizing the power of this burgeoning medium.”
The IAB’s report notes that social media advertising posted $22.2 billion in revenues last year, rising 36 percent over $16.3 billion in 2016. Search revenues reached nearly $40.6 billion in 2017, up 18 percent from $34.6 billion in 2016, and banner advertising was up 23 percent to $27.5 billion, 67 percent of which is derived from mobile banners. Digital audio, measured for the second time in a full-year report, is up 39 percent to $1.6 billion from $1.1 billion in 2016.
“Digital advertising revenues have been steadily rising for several years, and buyers continue to increase their investment,” says David Silverman, partner, PwC US. “From mobile to video, consumers are constantly turning to digital, whether for information, entertainment, shopping, sharing or more.”