A new report by ad agency Zenith in the US has found (many would argue hardly unsurprisingly, too) that ad spend on social media around the globe will overtake spends for newspapers in the next four years.
It also follows a provocative article on B&T yesterday that came with the rather dire warning that 2017 would be the year that digital started killing off traditional medias such as print and TV.
The report, titledAdvertising Expenditure Forecasts, found that spending on social media is growing at 20 per cent per year and would be worth $US50.2 billion by 2019. That was compared to $US50.7 billion for newspapers in the same period. By 2020, the report said, social will be “comfortably ahead”.
And it was good news all round in the Zenith report. It predicted that global ad spend would be up 4.4 per cent in 2016 and predicted the same increase for 2017. Zenith forecasts ad spend to growth 4.4 percent in 2018 and 4.1 percent in 2019.
By 2019, advertising on platforms such as Facebook and Twitter will account for 20 per cent of all internet advertising, the report revealed.
Online video is another fast-growing area, with ad spend on that format growing 18 per cent per year. By 2019, online video advertising expenditure will total $US35.4 billion globally, ahead of the $US25 billion for radio. However, the report noted that online video advertising is still nowhere near the size of the TV market.
The report stated: “Social media platforms have benefited from the rapid adoption of mobile technology, using it to embed themselves into their users’ daily lives. For many users, social media is the focal point of their social lives as well as their main source of news. Social media ads blend seamlessly into the news feed, and are much more effective than interruptive banner formats, especially on mobile devices.”
On ad spends generally, the report noted: “Global ads pend growth has been remarkably stable since 2010, growing at between 4 percent and 5 percent a year, generally at or below the growth rate of global GDP (gross domestic product). Before the financial crisis, advertising would typically exaggerate the wider economy, growing faster in times of expansion and shrinking faster during recessions, with frequent changes in year-on-year growth rates. More recently the global ad market appears to have entered a phase of more stable growth.”