Dive Brief:
- The Interactive Advertising Bureau reports total U.S. digital ad spending in 2016 reached a record $72.5 billion in 2016 per a press release.
- For the first time, mobile accounted for more than half of the total figure at $36.6 billion, or 51% of total online ad revenue. Digital video hit a record $9.1 billion, a 53% year-over-year increase. Mobile video was up 145% year-over-year.
- Top segments by spend included: retail (21.3%), financial services (13.3%), automotive (12.5%). Media accounted for 5.2% of spending, and was a fast-rising category with a 13% year-over-year lift.
Dive Insight:
The IAB report confirms what marketers most likely already understood — it is increasingly not just a mobile-first world but a mobile-only one. With mobile spend surpassing other segments for the first time, it is clear that brands are increasing their commitment to mobile as they look to connect with the on-the-go consumers. Mobile “fueled” the internet economy last year, according to Randall Rothenberg, President and CEO, IAB, while the spending total indicated that advertisers showed confidence in digital for achieving marketing goals.
The impressive year-over-year growth for mobile video indicates the influence and importance of video in mobile ad strategies and marketing programs overall. A significant proliferation in mobile video formats, including 360-degree video and live video, as well as outlets ramped up last year and is continuing so far in 2017. It is possible there will be some rationalization in the space as marketers hone in on those strategies that are most effective, but for now the IAB numbers suggest that brands are diving in head first.
Other findings from the IAB report include social media advertising generated $16.3 billion last year, up 50% and search revenues were up 19% at almost $35 billion. Digital audio was measured for the first time in the report and hit $1.1 billion in 2016, pointing to the quick evolution in the space for digital assistants and other voice-driven connected experiences. The spend on digital audio is likely to continue to grow in 2017 as Amazon, Google, Apple and others continue to double down on building their prowess here with the expectation that voice will be a leading engagement strategy in the near future.
