Tuesday 11th December 2018

Total digital ad spend hits all-time high of $88 billion

The report identifies another upsurge in mobile ad spend despite desktop typically outperforming mobile on sales (according to other reports).
Jason Smith
by on 15th May 2018

Total digital advertising spend reached an all-time high of $88 billion in 2017, according to a new report by the Interactive Advertising Bureau.

The total spent on digital advertising in 2017 represents a 21 percent increase in spend when compared to the previous year’s total of $72.5 billion.

The report also states that 2017 is the first year digital advertising has overtaken television advertising.

Unsurprisingly, mobile is also increasingly the device of choice for advertisers.

Mobile ad spend overtook desktop ad spend for the first time in 2016, at which point it accounted for $36.6 billion in spend and 50.5 percent of total ad spend.

The gulf between the two became even greater last year, as mobile went onto claim $49.9 billion of total advertising spend (56.7 percent of total spend).

The results could be deemed counter-intuitive, particularly as sales stats around key seasonal holidays continue to indicate that, in terms of sales, desktop outperforms mobile.

According to the Adobe Holiday Trends report, smartphones account for 23 percent of all sales between November and December, while desktop accounts for 67 percent.

A report from Monetate also shows that the average desktop conversion rate is 3.63 percent while the average mobile conversion rate is 1.25 percent.

Randall Rothenberg, IAB CEO, stated, “Mobile captured more than half of the total digital ad spend last year and we can easily expect that share to continue to climb”.

The report also shows that search attracts more digital ad spend than any other channel, accounting for a total spend of $40.6 billion in 2017 (which is a decrease of 1.5 percent year-on-year).

Banner advertising is the second most popular channel and accounted for $27.4 billion, while digital video and the “other” category (classifieds, lead generation and audio) accounted for $11.9 billion and $8 billion respectively.

Mobile has also outperformed desktop on video spend, with the former now accounting for $6.2 billion, which is 54 percent of the total spend on digital video.