Global ad spending grows, but Google and Facebook steal bigger shares, says GroupM
GroupM has painted a rosy picture for the global advertising industry in its latest ad investment report, estimating the sector’s US$24bn in new spending in 2018 will be the biggest increase since the 2010 recovery following the global financial crisis. Driving the 4.5% increase in global spending is digital, which GroupM estimates will grow by 12% to US$221bn this year.
In Australia, the advertising industry’s growth is forecast to be more subdued than the global numbers, with GroupM estimating 3.4% overall growth to AU$16.2bn.
Locally digital is expected to pick up 7.4%, however television spend is expected to slightly fall by 0.8%, despite the soccer FIFA World Cup driving global TV spending up 2% against last year’s 1% fall.
However, the news is not all good for media owners, as GroupM estimates Facebook and Google took 135% of new spending in the digital advertising – meaning they gobbled up all of the new available growth, plus taking share from other digital media companies.
Tracking digital spending remains problematic according to Adam Smith, GroupM’s futures director: “We’d like to have better intelligence on the ways investment dollars are flowing to digital,” he said.
“Digital ad revenue is reported either in whole, or by type, principally display and search, but never discriminates between large and small media owners, nor the short and long tail of advertisers who buy with or without agency support.
“While the same concern applies to other media, digital is unique in its long tail being dominated by global vendors. Because digital is mostly walled gardens, a country is doing well if 20% of its digital ad investment is properly categorised.”
Looking at global trends, GroupM also flagged China is expected to account for 17% of global ad revenues, having effectively doubled its share of the world’s ad spend over the past decade.
