Africa's internet adspend grows

23 September 2014

JOHANNESBURG: Internet advertising is growing fast across Africa, with its share of total expenditure set to double in some major markets over the next four years.

The latest Entertainment and Media Outlook report for the region from consulting firm PwC showed that internet advertising was making the greatest inroads in Nigeria, where its share was forecast to rise from 5.7% in 2014 to 12% in 2018, helped by a predicted CAGR of 32.7% between 2013 and 2018. By the end of that period it will have long overtaken traditional media such as newspapers and radio.

Smaller advances were evident in South Africa, where internet's share was predicted to increase from 4.3% to 7%, although its place in the pecking order will remain behind TV, radio, newspapers and out of home. A CAGR of 22.7% will be driven by search and mobile advertising, the report said, with Google, the most visited site in the country, holding the vast majority of the South African search market.

In the Kenyan market, a CAGR of 31.5% will make it the fastest growing advertising segment, boosting it share from 6% to 8.6%, but it will remain in fifth spot, after TV, radio, newspapers and out of home.

In monetary terms, South Africa remains some way ahead of the others, with current internet adspend standing at around $186m, compared to $59m in Kenya and $56m in Nigeria.

"Growth in the South African entertainment and media industry is largely being driven by the internet and by consumers' love of new technology, in particular mobile technology, such as smartphones and tablets, as well as applications powered by data analytics and cloud services," said Vicki Myburgh, entertainment and media industries leader for PwC South Africa, in remarks reported by The Drum.

She expected that, as in the rest of the world, South Africa's growth was likely to be digital, but added that "we believe that progress in the South African E&M market will be gradual and that there are still plenty of opportunities for 'old' and 'traditional' media yet".

Data sourced from PwC, The Drum; additional content by Warc staff