Digital’s Growth To Drive Total Global Ad Spending In 2017

In its latest Advertising Expenditure Forecast, Zenith Media expects global advertising expenditures to grow 4 percent in 2017 to $558 billion. Advertising in social media feeds, online video and other digital formats are driving much of this expansion, as they lead total display advertising—a category that also includes traditional banners—to 14 percent annual growth between 2016 and 2019.

Total display expenditure is expected to rise from $84 billion to $126 billion over this period, accounting for 64 percent of all the growth in global ad expenditure. By 2019, total display will account for 50.4 percent of internet advertising expenditure, exceeding 50 percent for the first time. Most of this growth is coming from social media (which will grow at 20 percent a year) and online video (which will grow at 21 percent a year).

In its assessment, Zenith notes, “Online video is much better at conveying brand values than traditional display formats like banners. These are no longer mutually exclusive categories; indeed, video advertising is now central to the growth strategies of most social media platforms.

“Internet display is coming into its own as a brand-building media, powered by social media and online video,” says Jonathan Barnard, head of forecasting and director of global intelligence at Zenith. “But the distinctions between online video and traditional television are being eroded, and the two work together much better than they do separately.”

In PPAI’s Distributor Sales Volume Report released this summer, promotional products ranked seventh in 2016 sales at more than $21 billion, and had grown by 15 percent over the past five years.

Display overtook paid search as the largest internet advertising channel in 2015. In 2016, expenditures on paid search totaled $78 billion, and Zenith forecasts 10 percent growth in the category through 2019, when it will reach $103 billion. Paid search’s 10 percent growth rate forecast lags behind total internet advertising’s expected rate of 12 percent per year.
 
“Internet platforms are continually innovating to provide advertisers with new ways of communicating with consumers,” said Vittorio Bonori, Zenith’s global brand president. “But newer doesn’t always mean better, and agencies must use all the data and technology available to them to determine how to combine new and old media to tell brand stories most effectively.”

Click here to download Zenith’s executive summary.

filed under September 2017
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