Mobile Advertising Grows Faster than Expected

The Brexit did not stop the growth of digital ad spending, according to a forecast issued by Zenith Optimedia. The global market is, in fact, strengthening, driven by the US, Western Europe, and the Philippines. Even network TV, which shrunk by 5% last year, is expected to return to growth in 2016. However, there was one important surprise: digital desktop spending is declining faster than print spending. This is the first time ever that a digital advertising mode has beat out the decline of print. Social advertising will also grow, and the combined growth number for the US is now forecast to be 4.4%.

Money from marketers is shifting, not so much from print to digital as from desktop to mobile. Desktop will be eclipsed by mobile in 2017  as Zenith had previously predicted, but

 we have upgraded our forecasts for mobile growth for this year (from 46% to 48%) and next year (from 29% to 33%), and now expect mobile adspend to exceed desktop by US$8bn in 2017, up from the US$2bn we predicted in June. By 2018 we expect mobile to account for 60% of all internet advertising, up from our previous forecast of 58%.

We may not have been able to come up with the numbers Zenith has put on the table, but from the growth of our ZINC business and the products from which it is coming we can already tell that mobile’s growth is happening faster and faster. The success of the recent rollout of our mobile ad unit Polite Swipe Up, as well as the ongoing success of our inArticle (outstream) mobile video format, as well as a shift away from some of our older formats, had already signaled the pace of the change.

In the US, the growth in ad spend is due to a good job market and a consumer who is recovering from the Great Recession. The UK suffered a mild downturn after the Brexit vote, although nothing like the dire predictions.

According to Zenith’s report,

Global advertising expenditure will grow 4.4% this year to reach US$539bn, ahead of the 4.1% previously forecast in June, according to Zenith’s new Advertising Expenditure Forecasts, published today. Advertising expenditure will then expand by 4.5% in 2017 and 4.6% in 2018 – up from the previous growth forecasts for both years, which were 4.3% and 4.4% respectively. By 2018 global advertising expenditure will total US$589bn, US$4bn more than forecast in June.

Marketers, it looks like you have your checkbooks out:-)