While we've known the growth of the mobile has been coming for sometime, according to ZenithOptimedia’s latest Advertising Expenditure Forecasts, global ad spend on the emerging channel is set to rise dramatically over the coming years, with global spend on mobile set to overtake that of newspapers next year.
According to the forecasts mobile will account for 12.4% of global ad spend in 2016, while newspapers account for 11.9%.
The number say that mobile internet will be the third largest advertising medium, behind television and desktop internet, with mobile advertising set to grow 38% in 2016 to US$71 billion, while newspaper advertising will shrink 4% to US$68bn.
Mobile advertising remains the driving force behind the growth of the entire advertising market, contributing 83% of all new ad dollars between 2014 and 2017. ZO predicts that mobile internet advertising’s share of the global ad market will rise from 5.7% in 2014 to 15.0% in 2017.
Steve King, ZenithOptimedia’s Worldwide CEO, commented: “Mobile technology is rapidly transforming the way consumers across the world live their lives, and is disrupting business models across all industries.
“We are now witnessing the fastest transition of ad budgets in history as marketers and agencies scramble to catch up with consumers’ embrace of the mobile way of life,” he said.
According to the forecasts, while desktop internet advertising will continue to grow, it will lose market share for the first time this year, dropping from 19.8% of global adspend in 2014 to 19.4%.
By 2017 ZenithOptimedia forecasts desktop internet to account for 19.1% of global adspend. Overall, internet advertising will account for 34.0% of global adspend in 2017, slightly behind television’s 35.9%. The market share gap between the two media will narrow from 13.3 percentage points in 2014 to 1.9 in 2017. At this rate of growth, internet advertising will overtake television in 2018.
Despite TV still having a few years left in sunshine in terms of adspend, online video players such as YouTube are already taking aim at TV, with Google Australia MD Maile Carnegie saying at the service's upfronts that YouTube reaches more Australians aged 18-54 than any individual TV station.
Advertising Expenditure Forecast also believes that global ad spend will grow 4.0% in 2015, with the forcasts citing that mature markets will drive growth for the first time in nine years.
ZenithOptimedia forecasts that global adspend will grow 4.0% to reach US$554bn in 2015, and will accelerate to 5.0% growth in 2016, boosted by the 2016 Summer Olympics in Rio and the US Presidential elections. Adspend will then slow down slightly in the absence of these events, growing 4.4% in 2017.
ZenithOptimedia that it has reduced its forecasts for adspend growth in 2015 since its June forecast by 0.2 percentage points, with the agency citing that with Brazil and Russia in recession, and China slowing down, the world can no longer rely on emerging markets to set the pace of growth. The business expects however that ‘mature markets’ such as North America, Western Europe and Japan to contribute more to global ad spend growth this year than ‘rising markets’, for the first time since 2006.
However it noted that this is a “temporary aberration”, however saying 'Rising Markets' will become the leading contributors to ad market growth again in 2016, and will increase their market share from 37.4% in 2015 to 38.8% in 2017.
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