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US internet adspend surges 20%

News, 22 April 2016

NEW YORK: Digital advertising expenditure in the US reached a record $59.6bn in 2015, a rise of 20% since 2014, according to the latest full-year figures from the Interactive Advertising Bureau (IAB).

There was also double-digit year-on-year growth of 23% in the fourth quarter of 2015, meaning revenues increased from $14.2bn in Q4 2014 to $17.4bn in Q4 2015.

Much of this was driven by mobile advertising, which soared to $20.7bn over the course of 2015, up 66% since the $12.5bn the IAB recorded for 2014.

Meanwhile, digital video (non-mobile), a component of display-related advertising, reached $4.2bn in 2015, a 30% rise on the $3.3bn recorded in 2014, while social media advertising brought in $10.9bn in 2015, up 55% over 2014's $7bn.

The IAB also reported that search (non-mobile) adspend reached $20.5bn in 2015, up 8% from $19bn in 2014, and display (non-mobile) revenues in 2015 totalled $13.9bn, up 3% over $13.5bn in 2014.

In terms of industry segments, retail advertisers continued to represent the largest category of internet ad spending and they were responsible for 22% last year, followed by automotive and financial services (13% each).

"Mobile's impressive upswing is a testament to its increasing importance to marketers," said Randall Rothenberg, President and CEO, IAB.

"Digital video is also seeing strong growth, and we anticipate brands and media buyers will drive further excitement about the future of the medium at the upcoming Digital Content NewFronts."

"There is no question that interactive screens are attracting consumers and the advertisers that want to reach them where they live – increasingly on mobile devices," added Sherrill Mane, SVP of research, analytics and measurement at IAB.

The 2015 total still ranks internet as the second-largest ad channel in the US, however. Warc's International Ad Forecast estimates spend of $63bn for TV last year, though this was down 3.4% from 2014.

Advertising revenues for US TV are expected to receive a boost this year due to major sporting and political events, as outlined in Warc's Global Adspend Outlook. Be that as it may, internet is now poised to become the largest channel in the US, and by extension, the world, by end-2016.

Data sourced from IAB; additional content by Warc staff