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IAB Australia Reveals Digital Ad Spend Surpassed $7b in 2016

The annual Digital Advertising Expenditure report for the 2016 calendar year was recently published by the Internet Advertising Bureau of Australia and showed that total spend increased by over 20% again on the previous year. The strong growth resulted in a 23% gain over the previous year, to finish at $7.4bn. That marks the fifth successive year of growth of over 20% and the continuing strength of this market.

The data comes from the annual IAB/PWC Online Advertising Expenditure Report (OAER) and shows that 2016 again saw the largest growth seen in Display advertising, driven by strong gains in video and mobile advertising. Although desktop display ad spend dipped due to shifting consumer device habits, the Video segment of the General Display market was the fastest growing area of digital in CY16, representing 28% of digital General Display.

The report also says that for the first time, mobile ads accounted for more than half of that spending — $36.6 billion, which is 51% of the total. Video advertising grew by 53% to $9.1 billion, social media spending grew more than 50% to $16.3 billion and search grew 19% to nearly $35 billion, so that it remains the largest sector in online advertising. The report also looked at digital audio ad revenue for the first time, saying it totalled $1.1 billion in 2016.

The IAB report doesn’t break out Facebook and Google specifically, and these 2 organisations dominate the market, despite figures not being officially released by them. However, the IAB does address “revenue concentration” by looking at the top 10 ad sellers and saying they accounted for 73% of total revenue — which is apparently not all that unusual, since the number has fluctuated between 69-75% over the past decade.

The last quarter of the 2016 calendar year showed growth of 15.3% to reach $1.97 billion. However, despite a 4.6% increase on the previous quarter, the market did not experience the normal level of seasonal growth expected for the December quarter. This was partly due to retail share of digital display spend remaining flat, although overall, retail increased with the growing market and the total ad spend was still up on the previous quarter and year.

The December quarter saw shifts in device expenditures, with the tablet share of device revenue dropping as advertisers move more money into smartphones to shadow changing consumer device habits.

You can read more here. If you would like more information on how these figures can be used to improve your online marketing, contact us now.