Commentary

Social Ad Spending Poised To Pass Newspapers

Global spending on social media advertising will overtake newspapers within the next four years, according to the latest media expenditure forecast from ZenithOptimedia, released on Monday. While impressive, it’s worth keeping in mind that the apparent shift in favor of social media is also partly the result of continuing declines in print ad spending.

Overall, Zenith expects social media spending worldwide to increase at a cumulative annual growth rate of 20% per year from 2016 to 2019, reaching $50.2 billion in the latter year. That would put it just behind newspapers, with $50.7 billion in 2019. Zenith predicts global social media ad spend will surpass newspapers in 2020, as print advertising continues its long-term secular decline.

According to the same forecast, newspaper ad expenditures will fall at an average rate of 5% a year from 2016-2019, while magazines will slip 4% per year. Zenith notes that in proportional terms, newspapers’ share of total ad spending globally has already fallen from 28% in 2006 to 11% in 2016, and will slump further to 8% by 2019. For their part, magazines’ share of the global total has fallen from 13% to 6% over the last decade, and will contract to 5% by 2019.

Social media ad spending, led by sites and Facebook and Twitter, will make up 20% of total Internet ad spending in 2019, up from 16% in 2016, per the same forecast.

Zenith listed some of the main elements driving social media’s current success: “Social media platforms have benefited from the rapid adoption of mobile technology, using it to embed themselves into their users' daily lives. For many users, social media is the focal point of their social lives as well as their main source of news. Social media ads blend seamlessly into the news feed, and are much more effective than interruptive banner formats, especially on mobile devices.”

Social media is also benefiting from the explosion of online video and mobile, considered separately by Zenith. Overall global spending on online video ads will grow 18% per year from 2016-2019, totaling $35.4 billion in the latter year. Meanwhile mobile ads of all kinds will soar to $160 billion in 2019, with much of this also going to social.
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