Digital ad spending in the US increased by $19.79 billion last year, a nice result given the stagnancy of the country’s overall media ad market (which includes traditional formats, like TV, radio, and print, where ad spending declined by 18.1%). We anticipate there will be $38.83 billion in new digital ad spending this year, for a total of $191.09 billion, as certain industries unleash their previously constrained budgets and others maintain their accelerated pace of digital transformation. That influx of ad dollars will be the largest in absolute terms since we began tracking these metrics in 2016.
The retail industry was the first vertical in the US to spend $20 billion on digital advertising, a threshold crossed in 2018. By the end of 2022, retail will exceed $50 billion in spending ($57.20 billion), a mark that no other industry will approach in the next couple of years. CPG, along with financial services, will remain distant trailers in second and third place, respectively, while the bulk of industries will spend between $10 billion and $20 billion per year through the end of our forecast period in 2023.
Digital ad spending by device
Mobile advertising is by far the preferred destination for digital ad spending in the US, just as it is everywhere else. However, mobile’s ever-accelerating domination of the digital ad market appears to finally be leveling off. After seizing large chunks of the market from nonmobile options every year since 2016, mobile will see its share of the pie settle in at roughly 68% for the rest of our forecast period.
The emerging popularity of connected TV (CTV) advertising is the primary reason that nonmobile ad spending is no longer losing share. Even so, every single industry in the US will spend the majority of its digital ad budget on mobile this year, as usual, with the lowest share being 57.1% and the highest being 76.5%. CTV’s time is coming, but clearly mobile still rules the digital roost.
Five industries will devote more than 70% of their digital ad budgets to mobile. CPG, along with entertainment, computing products and consumer electronics, financial services, and telecom will all continue to spend a greater share on mobile than the national average.
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