Programmatic driving resurgence in display ads with mobile to drive most future growth

ZO december ad spend region map

Global ad spend growth by region 2013-14. Click to enlarge

Global ad spend is set to rise by an average of 4.9 per cent per year from 2015 until 2017, with the rise in programmatic trading credited for a resurgence in display advertising, according to the latest ZenithOptimedia Advertising Expenditure Forecast.

Australia is put in the ‘Advanced Asia’ category in the report, along with New Zealand, Hong Kong, Singapore and South Korea, the last of which is predicted to overtake Australia and France to move up to seventh in the table for total ad spend by 2017. There is no individual breakdown for each market on how it is expected to perform on its own.

The media agency predicts for the Advanced Asia category: “We estimate growth here at a disappointing 2.4 per cent in 2014, after weakness in the property market damaged consumer confidence in Singapore. As Singapore recovers we expect growth to pick up to an average of 5.1 per cent a year through to 2017.”

Globally the agency says mobile advertising, which it classifies as all internet ads delivered to smartphones and tablets including display, classifieds and search, will be the biggest contributor to increased ad spend growing from an estimated US$25,8bn this year to US$68.2bn by 2017, leapfrogging radio, magazines and  outdoor to be the fourth largest medium just behind newspapers. It is expected to add more than half of extra ad expenditure in the next three years.

ZO ad spend forecast dec 14 13-14 regiobnalThe internet as a category is still forecast to grow by 15 per cent between 2014 and 2017 globally, with display as the fastest growing sub category with 18 per cent annual growth, which includes traditional display,  video and social media. The agency group credits this to better programmatic buying as well as more attention grabbing ads. Paid search is set to grow 14 per cent in that timeframe thanks to innovations from engines like Google and Bing, including more localised results.

The report notes: “Over the last ten years internet advertising has risen from 4% of total global spend in 2004 to 24 per cent in 2014. Meanwhile newspapers’ share of global spend has halved from 30 per cent to 15 per cent, while magazines’ has fallen from 13 per cent to 7 per cent. Internet adspend overtook total adspend on both newspapers and magazines this year.ZO ad spend forecast mobile

“We predict internet advertising will increase its share of the ad market from 23.8 per cent in 2014 to 31.1 per cent in 2017, while newspapers and magazines will continue to shrink at an average of 2 per cent a year.”

However TV will remain “by some distance the dominant advertising medium” with 40 per cent of spend this year globally, and is predicted to grow at around 3 per cent per annum over the next three years.

ZO ad spemnd forecast Dec 14 top ten markets“Television’s market share has grown steadily over the last three and a half decades, from 29.9 per cent of spend in 1980 to 39.6 per cent in 2014,” the agency writes. “We think it has now peaked, however, and forecast it to fall back slightly to 37.4 per cent in 2017. Marketers are also beginning to move small budgets away from television to online video, which we expect to grow from 1.9 per cent of global adspend in 2014 to 2.8 per cent in 2017.

“The audiovisual share of the market will therefore fall by only 1.3 percentage points, from 41.3 per cent in 2014 to 40.2 per cent in 2017.”


Global ad spend is expeceted to reach US$545 billion by the end of 2015.


ZO adspend december 2014

ZO ad spend forecast global percentage by medium


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