A report released this week by ZenithOptimedia reveals projections for global ad spend in 2015, with online advertising said to be the fastest growing medium having grown 16.9% in 2014 with an estimated 15% growth over the next two years.
Online advertising makes up 24% of total global ad spend, which is substantial considering ten years ago it only made up 4% of global ad spending.
The rise in online advertising spending can be attributed to the decline of magazine and newspaper advertising. While those two mediums are on the decline in terms of ad spend, ad budgets for online advertising are on the rise.
The ability to target ads more accurately has led to agencies spending more on what would now be considered “traditional” display advertising.
“The technology has recently evolved to deliver better premium, brand-building experiences,” the report states. “Growth in traditional display leapt from 14% in 2012 to 18% in 2013, and we estimate it at 26% in 2014, its fastest rate of growth since 2007.”
According to the report, most of all display advertising is bought directly by small local companies with yearly advertising budgets of only a few thousand dollars.
Mobile is also going to be a tremendous driver of growth in global ad spend going forward, which is expected to account for 51% of all new advertising dollars between 2014 and 2017. The ubiquity of mobile devices, combined with innovations in ad technology, is said to drive mobile advertising to grow by 38% a year between 2014 and 2017.
While traditional display advertising and retargeting isn’t as effective on mobile as it is on desktop, where advertisers are said to be seeing the most success is with social media display advertising:
Facebook and Twitter have rapidly restructured their operations for mobile consumption and advertising, and between them are on track to capture 33% of all mobile adspend in 2014… Their ads are designed to blend seamlessly into the content feed – they look native rather than intrusive. They can track all their users’ media consumption within their apps, and can tie that into their desktop activity through their login details. Social media provides a great example of how to adapt to mobile.
For more information about the growth of online advertising in 2015 and beyond, you can read the full press release here.