Mobile Ad Spend To Cross $100-Bn Mark Globally In 2017

As digital is set to overtake TV this year in terms of advertising spends, MAGNA predicts mobile advertising to pass the $100-billion mark for the first time this year ($110 bn). Mobile drives growth within digital, as the majority of ad sales (54 per cent) are now generated by impressions and clicks on smartphones.

Digital will continue its rise and grow 14 per cent this year, while offline ad sales (TV, print, radio, out-of-home) will drop 2 per cent. MAGNA also expects online advertising to pass the $200-billion mark ($204 billion) and lead advertising sales globally, with 40 per cent of total ad sales compared to the 36 per cent for TV.

Video and social formats will continue to drive digital advertising growth (over 30 per cent), while paid search will grow in double digit  (over 13 per cent) to remain the lead format accounting for almost half of digital ad sales.

MAGNA’s report shows that while desktop video is growing at 14 per cent, the engine for online video ad spend growth is mobile, which accounts for 56 per cent growth bringing mobile’s share of video spend to 45 per cent this year.

By 2021, online video advertising will have passed the $50-billion mark globally, and digital video will represent more than 20 per cent of total video viewing (TV and online video).

Vincent Létang, executive vice-president, Global Market Intelligence at MAGNA and author of the report, says, “The record level of growth in 2016 globally, outperforming economic growth, was caused by marketers willing to embrace the new opportunities offered by digital media (search, social, video, programmatic) on a larger scale, while anxious to preserve their share of voice on traditional linear television, despite rising CPMs costs. In 2017, both digital and offline growth will slow down. Online advertising sales will nevertheless continue to grow in double-digits in most markets, but TV ad sales will decline (1 per cent) due to softer price increases, ratings erosion and the lack of global sports events.”

The India Outlook
Indian advertising revenue will grow 11.5 per cent in 2017. It is slightly below the previous forecast by MAGNA — which was a 13.5 per cent growth — but in line with last year’s growth (11.8 per cent).

Online ad sales in India will grow 28 per cent to reach 17 per cent of total ad revenues. TV (40 per cent market share) and print (35 per cent) will remain the biggest categories, growing by 10 per cent and 6 per cent, respectively, this year.

MAGNA expects the Indian market to grow 12.5 per cent next year (2018) and accelerate further to 14 per cent in 2019, boosted by the Cricket World Cup and general elections.

Gurpreet Singh, managing director APAC MAGNA, says, “The APAC advertising economy looks relatively promising in 2017 with higher ad spend growth predicted across the majority of markets this year vs 2016. Digital continues to be the highest growth driver in the region, following the global trend.