US Digital Ad Spending Will Surpass Traditional in 2019

This year will mark a major milestone in the world of advertising. For the first time, digital ad spending in the US will exceed traditional ad spending, according to eMarketer’s latest forecast. By 2023, digital will surpass two-thirds of total media spending.

Total digital ad spending in the US will grow 19% to $129.34 billion this year—54.2% of estimated total US ad spending. And mobile will continue its dominance, accounting for more than two-thirds of digital ad spending, at $87.06 billion this year.

Also for the first time, the combined share of the duopoly (Google and Facebook) will drop, even as their revenues grow. Google’s share will drop to 37.2% from 38.2% last year; Facebook’s share will drop to 22.1% from 21.8% last year.

Top 5 Companies, Ranked by US Net Digital Ad Revenue Share, 2018 & 2019 (% of total digital ad spending)

The big winner this year will be No. 3 player Amazon, which continues to take share from just about everyone. Its US ad business will grow more than 50% this year and its share of the US digital ad market will swell to 8.8% this year.

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“Amazon offers a major benefit to advertisers, especially CPG and direct-to-consumer [D2C] brands,” said eMarketer forecasting director Monica Peart. “The platform is rich with shoppers’ behavioral data for targeting and provides access to purchase data in real time. This type of access was once only available through the retail partner to share at their discretion. But with Amazon’s suite of sponsored ads, marketers have unprecedented access to the ‘shelves’ where consumers are shopping.”

Where are the digital dollars coming from? Directories, such as the Yellow Pages, will take the biggest hit—down 19% this year. Traditional print (newspapers and magazines) spending is a close second, which will drop nearly 18%. Overall, traditional ad spending’s share in the US will drop to 45.8% in 2019, from 51.4% last year.

“The steady shift of consumer attention to digital platforms has hit an inflection point with advertisers, forcing them to now turn to digital to seek the incremental gains in reach and revenues which are disappearing in traditional media advertising,” Peart said.

TV ad spending will decline 2.2% to $70.83 billion this year, largely because there are no elections or big events, such as the Olympics or World Cup. The presidential election next year will propel TV ad spending back into positive growth, before falling again in the following years.

Courtesy of eMarketer

 

 

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