Internet advertising forecast to exceed half of global ad spend in 2021

Internet advertising will account for 52 per cent of global advertising expenditure in 2021, exceeding half of all ad spend for the first time, according to a new report. 

However, the June Advertising Expenditure Forecasts report by US media agency Zenith Media also states that the growth in internet advertising spend is falling as the internet ad market matures. 

Internet ad spend grew 17 per cent in 2018 and accounted for 44 per cent of global spend, but activity in the first half of 2019 leads Zenith to expect only 12 per cent growth for the 2019 year as a whole (with internet advertising expected to account for 47 per cent of global ad spend). 

“By 2021, we expect internet ad spend growth to have fallen to 9 per cent year-on-year. The growth rate of the internet ad market is starting to converge with the growth rate of the market as a whole,” said Zenith. 

The report states that internet advertising growth is led by online video and social media, which are expected to grow at respective average rates of 18 per cent and 17 per cent a year to 2021. 

“These channels are benefitting from continued technological improvements to smartphone technology, connection speeds, and advertising targeting and delivery, combined with strong growth in investment in content.”

June 2019 Advertising Expenditure Forecasts report, Zenith Media

The agency also points to 5G technology, which launched in South Korea and the US in April and is starting to roll out elsewhere, as further improving brand experiences on these channels by making mobile connections faster and more responsive. 

However, in Australia, Roy Morgan has said that the population needs convincing of the benefits of 5G technology following the findings of a recent survey that fewer than half of the respondents would consider buying a 5G mobile phone. 

Zenith said that other online channels are growing much less rapidly: 

  • Paid search accounted for 37 per cent of internet ad spend in 2018 and grew by 11 per cent that year, however its growth rate is expected to fall to 7 per cent in 2021. Zenith points to innovation in ‘voice search’ which is not currently monetised, as slowing this growth.
  • Online classified advertising (ads sitting alongside other ads rather than content, such as jobs, property and second-hand vehicle listings) is starting to lose out to other digital channels, or free alternatives. 
  • Online classified advertising grew 9 per cent globally in 2018, but is already starting to shrink in some markets, and in 2021 we expect spending to decline by 1.6 per cent globally.

Internet ad spend growth driven by small business

The report outlines that much of the growth in internet ad spend is coming from small, local businesses that spend all their budgets on platforms like Google and Facebook, because these platforms offer simple, self-serve tools to manage campaigns, and highly targeted audiences. 

However, Zenith notes that the fact that large numbers of small advertisers are spending all their budgets online means they are skewing the overall picture. 

“The global average is made up of very many small advertisers that spend all their budgets online, and large advertisers that – on average – devote considerably less than half their budgets to it. Big brands are investing large sums in internet advertising, but the majority are still spending most of their budget in traditional media,” the company said. 

Zenith Global Brand President Matt James said “The categories that have advanced the furthest in using modern digital channels are technology, media, finance and professional services.

“And even within these, brands still rely on traditional media to create broad mass awareness and reinforce brand values.”

Print ad spend continues to decline 

Within the traditional media, the report states that print has long been in decline as online alternatives have taken their readers and advertisers: the ad revenues of printed newspapers and magazines peaked at US$164 billion in 2007 and will total just US$70 billion in 2019. 

The report finds that broadcast television is now beginning to shrink, though not nearly on the same scale as print, while other traditional forms of media such as radio and cinema are projected to have small growth.

In Zenith’s latest Media Consumption Forecasts report, the company found that, globally, people will spend an average of 800 hours using internet on mobile phones in 2019 – equivalent to 33 days without sleep or pause – and by 2021, this is expected to rise to 930 hours, or 39 full days. 

Mobile internet has eaten into the amount of time people spend with print media: Zenith found that between 2014 and 2019, the average amount of time spent reading newspapers has fallen from 17 minutes per day to 11 minutes per day. Time spent reading magazines has fallen from 8 minutes per day to 4 minutes per day, however this is expected to plateau to 2021. 

FIPP charted Zenith’s findings

What types of media take up most people’s time? Chart compiled by FIPP. Information source: Zenith Media.

Total global ad spend growth led by US, China, UK and India 

Zenith forecasts global ad spend to grow by 4.6 per cent in 2019 to reach US$639 billion, an increase of US$28 billion. 

Almost half this growth will come from the US, which is benefiting from very rapid growth in internet advertising – at 15.4 per cent, ahead of the global average of 11.7 per cent. China, the UK and India will also be major contributors. 

“The point at which internet advertising exceeds 50 per cent of global adspend has been approaching for some time, but this is the first time it has appeared in our forecasts,” said Jonathan Barnard, Head of Forecasting at Zenith. 

“However, 2021 will be the first year of single-digit internet ad spend growth since 2001, the year the dotcom bubble burst.”

To purchase Zenith’s reports, visit the company’s website.

Written by Lyndsie Clark

Niche Publishing Network Founder and Editor Lyndsie Clark has over 10 years of niche publishing experience, working in a variety of roles spanning B2B editorial, sales, operations, events, BD, and management.


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