Privacy Concerns Bolster Rise Of Social Media Ad Spend

Over the next couple of years, programmatic ad growth shows no signs of slowing, while social networks continue to take an ever larger share of the programmatic pie.

That’s according to the latest forecast from eMarketer, which expects programmatic digital display advertising spend to grow from just over $57 billion, this year, to nearly $80 billion by 2021. 

Facebook and other social networks are expected to soak up about 56% of this year's share of programmatically transacted display ads.

Eric Haggstrom, forecasting analyst at eMarketer, predicts that social’s share of programmatic ad dollars will rise through 2021 as advertisers continue to prioritize social video and other social network ad formats.

“Advertising in a cookie-free mobile app environment where users spend much of their digital time is complicated and difficult,” Haggstrom notes in the new report. Yet, “Social networks prove to be the major exception.”

Crediting social networks where credit is due, Haggstrom adds: “They’ve made it relatively easy to target audiences at scale in an in-app environment.”

As such, eMarketer has increased its estimates for social as a portion of total programmatic since its last forecast April.

That’s also thanks to stronger-than-expected performance from social networks like Facebook, Twitter and Snapchat, as well as ongoing expectations that advertisers will continue to seek out social networks and other “walled gardens” over the next two years.

“These sites have the scale and identity capabilities that advertisers want,” Lauren Fisher, principal analyst at eMarketer, acknowledges in the report.

“That matters, particularly as we enter into a world where privacy restrictions are making it harder for advertisers to track, target and measure,” according to Fisher.

More broadly, eMarketer expects programmatic advertising -- defined as the use of automation in the buying, selling or fulfilling of digital ads -- to account for 83.5% of total digital display ad spending, this year.

Haggstrom, Fisher, and their colleagues attribute what they expect to be programmatic’s continued growth to increasing investment in areas such as digital audio, social video, connected TV and over-the-top advertising.

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