Digital ad spend to exceed traditional budgets in US for first time
Details
Michelle Clancy
| 21 February 2019

For the first time, digital ad spending in the US in 2019 will exceed traditional ad spending and by 2023 digital will surpass two-thirds of total media spending says eMarketer’s latest forecast.

The firm expects that total digital ad spending in the US will grow 19% to $129.34 billion this year—54.2% of estimated total US ad spending. And mobile will continue its dominance, accounting for more than two-thirds of digital ad spending, at $87.06 billion this year.

Also for the first time, the combined share of the Google and Facebook duopoly will drop, eMarketer predicts, even as their revenues increase.

The big winner this year will be No 3 player Amazon, whose US ad business will grow more than 50% this year; its share of the US digital ad market will swell to 8.8% this year.

“Amazon offers a major benefit to advertisers, especially CPG and direct-to-consumer [D2C] brands,” said eMarketer forecasting director Monica Peart. “The platform is rich with shoppers’ behavioural data for targeting and provides access to purchase data in real time. This type of access was once only available through the retail partner to share at their discretion. But with Amazon’s suite of sponsored ads, marketers have unprecedented access to the 'shelves' where consumers are shopping.”

As for where the digital dollars are coming from, directories, such as the Yellow Pages, will take the biggest hit—down 19% this year. Traditional print (newspapers and magazines) spending is a close second, which will drop nearly 18%. Overall, traditional ad spending’s share in the US will drop to 45.8% in 2019, from 51.4% last year.

“The steady shift of consumer attention to digital platforms has hit an inflection point with advertisers, forcing them to now turn to digital to seek the incremental gains in reach and revenues which are disappearing in traditional media advertising,” Peart said.

TV ad spending meanwhile will decline 2.2% to $70.83 billion this year, largely because there are no elections or big events, such as the Olympics or World Cup. The presidential election next year will propel TV ad spending back into positive growth, before falling again in the following years.