Digital strides ahead

22 October 2014

NEW YORK: US digital ad revenues continue to reach new highs, growing 15% in the first half of 2014 to reach $23.1bn, according to the IAB, while a separate report from AOL Platforms suggests that media buyers are increasingly shifting TV budgets into digital video.

Latest figures from the Interactive Advertising Bureau (IAB), a digital trade organisation, show mobile making great strides, surging ahead 75% year on year to a total of $5.3bn. It now accounts for 23% of all digital spending, up from 15% in the first half of 2013.

It has achieved this largely at the expense of search and banner ads, both of which increased only slightly in dollar terms – by around 4% – resulting in their share of the total slipping from 43% and 19% respectively to 39% and 17%.

Banner ads form the largest part of display-related advertising, followed by digital video (6% of all digital), sponsorships (2%) and rich media (3%).

"Digital screens have become vital tools at every juncture of the day," said Sherrill Mane, svp/Research, Analytics and Measurement, IAB, as she observed that it was now the norm for consumers to be living online. "It is no surprise that brand dollars have followed this growing movement at a steady clip," she added.

That shift could be approaching a long-heralded tipping point, as a study for AOL Platforms revealed that 40% of media buyers are planning to transfer resources from broadcast to video over the coming 12 months.

"I'm surprised that number isn't 90%," said Rob Reifenheiser, North American head of media at media buyer Essence Digital, who argued that there were many reasons to have digital video in the media mix.

He expected that in future more and more TV and video budgets would come from the same bucket. "I would call it a video-neutral approach," he explained. "You have one line item, which is your video, and from there you triangulate what the right mix is, especially when you look at reach potential."

Data sourced from IAB, AOL Platforms; additional content by Warc staff