Online advertisers are expected to spend $1.5bn on online advertising annually by 2018, according to a new report. Over the last year it has grown 12% to $862 million, according to Frost & Sullivan, driven increasingly by online video.
The Australian Online General and Mobile Advertising Market 2013 report claims online video accounts for 15% of online ad revenue, up from 11% a year before. Social media has also increased at 11%, up from 9% of total online spend last year.
Ad networks still hold on to the biggest slice of the pie, but the share of spend dipped. Online publishers' share of the online ad market dropped 2% in the last 12 months. The landscape has shifted significantly over the last two years with the growth of ad exchanges, trading desks and programmatic buying altering how media agencies, publishers and ad networks buy and sell inventory.
Publishers including Yahoo!7 and Fairfax Media are developing data management platforms to offer more advanced targeting to counteract the slide. Smaller digital publishers including Prime Media Group are challenging the big players and reported steady growth during the period.
Online video advertising is expected to reach $513 million, or 34% share of the market, in 2018, increasing from $133 million in 2013.
Budget allocation for digital is growing. Four in 10 advertisers are diverting funds from traditional channels to digital. The Frost & Sullivan report also found that around half advertisers achieved measurable ROI from their online advertising in 2013.
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