Study: Mobile to grab majority of online display profits in 2020
Mobile display advertising continues to surge, and it’s on pace to claim a significant portion of online advertising revenue.
In fact, more than three-quarters of all online display advertising income will stem from mobile by 2020, according to data from analytics provider by IHS Markit.
Global mobile display advertising surged 72% in 2015 compared to the previous year, and accounted for 45% of all online display advertising revenue. In 2016, worldwide mobile advertising was on pace to grow 42% to $41 billion, and for the first time will generate more than half (55%) of all online display advertising revenue.
“Mobile advertising has grown stronger than any other medium in the last four years, and now accounts for a significant proportion of online advertising revenue,” said Qingzhen Chen, senior analyst at IHS Markit.
Despite economic restructuring, China has maintained its growth momentum and remained a global force in regard to its online advertising initiatives. Specifically, the country produced roughly $33 billion in revenue for 2016, making the Chinese online advertising market the second largest in the world. Online grew 17.5% in 2016, and will grow 14% in 2017, driven by a strong growth of online video (51% and 32% growth, respectively), data revealed.
On the other hand, after a period of rapid growth, TV has entered a third year of consecutive decline with a single-digit contraction. Many people are switching to online for content consumption and seeking wider range of content, from foreign information to user-generated content by popular vloggers. TV in China declined 2.7% in 2016, and IHS Markit expects a 3% drop in 2017.
“In 2016, the Chinese online ad market went through some turbulence and reshuffling,” Chen said. “China introduced its first set of online advertising regulations, which in the short term had reduced online advertising revenue, but in the long term, we expect to see a more sustainable online ad ecosystem from this development.”