Digital Ad Spend Increases 23% YoY Hitting Record-Breaking High of $40.1 Billion

Digital Ad Spend Increases 23% YoY Hitting Record-Breaking High of $40.1 Billion

According to IAB Internet Advertising Revenue Report, Significant Advertising Investments from Small & Medium-Sized Businesses is Fueling the Growth of the Digital Marketplace

Interactive Advertising Bureau (IAB) announced that digital advertising revenues in the United States for the first half of 2017 surged to an all-time high of $40.1 billion, according to the latest IAB Internet Advertising Revenue Report released by the industry trade group and prepared by PwC US. This represents a 23 percent year-over-year rise from the $32.7 billion reported during the same timeframe in 2016.

Mobile captured 54 percent of total digital ad revenues—maintaining its status as the web’s leading ad format. Advertisers spent $21.7 billion on mobile during the first six months of 2017, a 40 percent increase from $15.5 billion in half-year 2016 and far surpassing the $8.2 billion reported just two years ago in HY 2015.

In an addendum to the report, IAB analysis shows that of the roughly 9 million small and medium-sized businesses in the U.S., 75 percent or more have spent money on advertising. Of these, 80 percent have used self-service platforms and 15 percent have leveraged programmatic advertising. These findings point to significant ad spend going to publishers with these capabilities, and presents a growth opportunity for those that can add self-service and programmatic geared to these businesses into the mix.

Other highlights from the report include:

  • Total digital video, including mobile and desktop, rose to $5.2 billion in HY 2017, up 36% from $3.8 billion in HY 2016
  • Video on mobile overtook video on display for the first time, with mobile video reaching $2.6 billion in HY 2017, compared with display video, which was just shy of that same figure
  • Total social media advertising, including mobile and desktop, brought in revenues of $ $9.5 billion in HY 2017, a 37% upswing over $7 billion in HY 2016
  • Total digital audio advertising, including mobile and desktop, generated $603 million in HY 2017, a 42% increase over HY 2016’s revenue of $425 million
Randall Rothenberg
Randall Rothenberg

“Being nimble and accessible are hallmarks of the new digital economy,” said Randall Rothenberg, CEO, IAB. “Now, anyone with a good idea and a credit card can capture the attention of their customers directly, and this in turn represents an enormous growth opportunity for both marketers and publishers alike to help make these connections.”

“We’ve seen digital marketing revenues climb steadily and this new analysis shows that there are more opportunities to be mined,” said Chris Kuist, Senior Vice President, Research and Impact, IAB. “Varied audiences and advertising approaches can appeal to a wide variety of marketers in different shapes and sizes, bringing more dollars into the ecosystem and increasing the health of the interactive marketplace for all.”

Read More: DeepIntent Launches Verified Ads to Authenticate Political Ads

David Silverman
David Silverman

“We should no longer think of the internet as mobile versus desktop,” said David Silverman, Partner, PwC US. “Advertisers are simply following consumers, who live their lives online—whether on a smartphone during a commute, on a desktop at work, or on a tablet for entertainment in the evening. Digital is an intrinsic part of every American’s day.”

IAB sponsors the IAB Internet Advertising Revenue Report, which is conducted independently by the New Media Group of PwC. The results are considered a reasonable measurement of interactive advertising revenues because the data is compiled directly from information supplied by companies selling advertising on the internet. The survey includes data concerning online advertising revenues from web sites, commercial online services, free email providers, and all other companies selling online advertising.

The Interactive Advertising Bureau (IAB) empowers the media and marketing industries to thrive in the digital economy. It is comprised of more than 650 leading media and technology companies that are responsible for selling, delivering, and optimizing digital advertising or marketing campaigns. Together, they account for 86 percent of online advertising in the United States. Working with its member companies, the IAB develops technical standards and best practices and fields critical research on interactive advertising, while also educating brands, agencies, and the wider business community on the importance of digital marketing.

Recommended Read: IAB Study: Desktop, Mobile and Mobile In-App Improves Cross-Media Ad Campaign Effectiveness

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