A recent Internet Advertising Revenue report, collaboratively released by the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC) reveals that results are, for the most part, consistent with recent years’ figures.
The report IAB-PwC report covered Q4 and all of 2014. Overall growth—in the double digits—was prompted by mobile, according to the report, wrote MarketingCharts.
Online Ad Spending
- Online ad spending: 15.6 percent, year-over-year in 2014, from $42.8 billion to about $49.5 billion
The year-over-year growth rate in Q4 of 17 percent was the same for the prior year’s Q4 growth rate. Meanwhile, quarter-over-quarter growth rate in Q4—16 percent—was the greatest in more than Q4 2003’s 22 percent.
- Full-year mobile ad spending: Increased 76, percent year-over-year; dropped from 110 percent, year-over-year, in 2013
- Mobile advertising spending (2010 through 2014): Increased at a compound annual rate of 110 percent, 11 times quicker than the rate of 10 percent for non-mobile and not as rapid as the comparable rate for internet advertising in its first 5 years. That rate grew at an annual rate of 135 percent, significantly faster than inflation-adjusted rates for broadcast TV—79 percent—and cable TV—69 percent—according to the report.
Non-mobile (desktop) search: Remains the largest format, sharing with mobile in recent years. In 2014, non-mobile search comprised 38 percent of total spending, a drop from 43 percent in 2013.
Mobile grew from 17 percent of online ad revenues in 2013 to 25 percent in 2014. Approximately 75 percent of online spending involved other devices, such as desktop and laptop. Mobile advertising spending includes various formats, such as mobile search.
Mobile revenues are just about evenly split with search with 48 percent attributed to mobile and 49 percent to display; the remaining formats comprise the difference. When combining information for both mobile and desktop search, some half of online ad spend was devoted to search advertising in 2014.
- Non-mobile display advertising: 27 percent of full year revenues, down from 30 percent the prior year:
- Banner Ads: 16 percent
- Digital Video: 7 percent
- Rich Media: 3 percent
- Sponsorship: 2 percent
- Mobile advertising: 25 percent.
- Non-mobile display advertising: 27 percent.
Mobile Ad Revenues (including mobile display): Combining mobile and non-mobile display ad leads to display of about 40 percent of total online ad spending.
- Mobile ad spending: Increased 76 percent to $12.5 billion.
- Non-mobile search: Increased by 3 percent to $19 billion.
- Non-mobile display-related spending: Increased 5 percent to $13.5 billion.
- Non-mobile digital video spending: Increased nearly 18 percent to $3.3 billion.
Social Media Ad Spend
- Revenues exceeded $4 billion in the second half of the year; spending was devoted, in great part, to social ad spend, a 58 percent year-over-year growth increase from the second half of 2013 of $2.6 billion.
- Social media ad revenues totaled $7 billion for 2014, a nearly 56 percent year-over-year increase.
- Performance-based pricing—the leading model in recent years: Increased 1 point to 66 percent of revenues by pricing model.
- CPM/Impression-based pricing: Remained at 1/3rd of revenues, appearing to stabilize in recent years after dropping from nearly half of revenues in 2006 to 31 percent in 2011.
- Hybrid pricing dropped 1 point to just 1 percent.
4 Trends in US Online Advertising Spending; April 23, 2015; by MarketingCharts staff.