Commentary

Forecast: By 2017, 75% Of All Programmatic Display Ads Will be Mobile

A new eMarketer forecast for programmatic ad spending in the U.S. predicts that spending in the sector will continue to grow at double-digit rates for the next few years. In fact, the digital research firm forecasts that this year, programmatic display ad spending will hit $25.23 billion. This number is a few billion more than eMarketer previously estimated. Further, programmatic spending in 2016 will comprise 73.0% of all display ad spending in the U.S.

The forecast represents an update to eMarketer’s January 2016 forecast, according to Lauren Fisher, senior analyst. In the earlier forecast, she said eMarketer estimated programmatic would account for 67% of of total U.S. digital display ad spending in 2016. That figure was revised, in part, due to Facebook's earnings performance.

In fact, Facebook will capture the lion’s share of U.S. programmatic display dollars through 2018, raking in $11.10 billion in programmatic revenues, or 43.7% of the total, according to eMarketer. Google comes in No. 2, nabbing $2.39 billion, or a 9.4% share.

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Even more interesting, this year, mobile programmatic ad spending will grow 65.7% to $17.70, outpacing desktop spending levels. While desktop programmatic advertising continues to grow, it does so at a slower rate, eMarketer found. And a stunning projection by eMarketer: By 2017, mobile will represent nearly 75% of all programmatic ad spending, while desktop will account for about 25%.

Spending on programmatic video is also on the rise. Notably, eMarketer projects that spending will more than double this year to $6.18 billion, amounting to 60.0% of all digital video ad spending. The research firm attributes the rise to improved targeting and measurement, along with some improvement in issues which continue to plague the advertising industry at large: ad fraud and viewability. As these concerns are addressed, more marketers are likely to dip their toes into programmatic video.

“Programmatic buying is becoming more popular as marketers increasingly take an audience-centric approach to their display ad buys,” Fisher stated.

“The numbers show, pretty much across the board for display, regardless of device, display vs. video, etc., that programmatic is now a primary means of buying and selling ads. This shows that both buyers and sellers are now getting comfortable with it, and the market has matured,” Fisher told RTBlog via email. “Given that, I think the story in the next 12 to 24 months will be less about programmatic’s use in any one format or channel, and more about greater cross-device and cross-channel targeting and measurement capabilities. There's such a push from brands and agencies to transition to a more audience/customer-centric view of things vs. a channel or device agnostic one, and that's going to push for added advancements and improvements to cross-device and cross-channel targeting and measurement," she said.

“We'll also see this audience consciousness continuing to drive interest and advancements in bridging digital and offline audiences, particularly on the video front.” Fisher told RTBlog.

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