Data from Q1 2017 IAB PwC Online Advertising Expenditure Report shows digital ad spend up 7.2 per cent year on year
Total online advertising spend continues to grow, with first quarter expenditure at $1.86 billion, up 7.2 per cent year on year.
This represents a seasonal decline of 5.8 per cent on fourth quarter expenditure, although classified increased by 7.1 per cent compared to Q4 and had the strongest year on year growth of 15.9 per cent. All categories grew year on year with search up 6 per cent and display 4.5 per cent.
Overall, auto is the category that dominates digital display advertising spend. It now accounts for 20.3 per cent of the display market, with travel share up 6.4 per cent compared to Q4 and consistent with a seasonally higher spend for this category in Q1 each year.
Auto has now been the number one display category for five years, demonstrating that automobile brands were quick to embrace and maintain their investment in digital.
"Digital advertising is a key component of our client's overall advertising spend; it is measurable and actionable and their investment in the medium is increasing," said Anthony Saines, IAB board member and Managing Director – Commercial, at Carsales. "Digital is able to effectively drive personalised experiences across multiple platforms, from consideration through purchase. Brands are able to tailor their message to the appropriate audience which is driving exceptional results within the auto category."
Mobile continues its exponential growth, with mobile expenditure at $653 million in Q1, up 29 per cent year on year and a minimal seasonal dip of 1 per cent compared to the previous quarter. Mobile continues to represent more than 50 per cent of the display market (53.5 per cent); a significant increase from the 21.5 per cent it represented just three years ago. This reflects consumption habits; in March 63 per cent of digital time was spent on smart phones in Australia, as well as the continuing maturity of mobile advertising campaigns.
Video also continues to increase its share of advertising expenditure. It now accounts for 36.3 per cent of display, a significant 11 per cent share increase from just three years ago when it accounted for just 25.3 percent. Within the video category FMCG and retail account for 30 per cent of total video spend and are the top two video advertiser categories. Interestingly the real estate category which has a high general display spend (accounting for 12.1 per cent of general display) has yet to fully embrace video which suggests considerable upside for future reporting quarters.
“The online advertising marketing continues to surpass historical year on year figures across all categories,” said Vijay Solanki, CEO of IAB Australia. “Significantly, mobile continues on its steep growth trajectory, further increasing its share of general display advertising both quarter on quarter and year on year. This speaks to both the ubiquity of smart phones within Australia and improved mobile advertising technology and creative as brands better understand the challenges and opportunities the platform offers. Our numbers also dovetail neatly with some of the headlines from this year’s Mary Meeker report, especially the global growth of mobile.”
To find out more about the methodology behind the PwC OAER, listen to PwC Partner Megan Brownlow and IAB’s Director of Research Gai Le Roy discuss how the report is put together in this podcast.
The PwC OAER report is the only digital advertising expenditure report in Australia that includes revenue from both agencies and direct advertisers.
About the Interactive Advertising Bureau
The Interactive Advertising Bureau (IAB) Limited is the peak trade association for online advertising in Australia and was incorporated in July 2010. As one of over 43 IAB offices globally, and with a rapidly growing membership, IAB Australia's principal objective is to support and enable the media and marketing industry to ensure that they thrive in the digital economy.
The role of the IAB is to work with its members and the broader advertising and marketing industry to assist marketers to identify how best to employ online as part of their marketing strategy, to better target and engage their customers and build their brands.
By addressing the core pillars of growth of the online advertising industry - simplified and standard online audience measurement, research, and online operational standards and guidelines, and regulatory affairs, IAB Australia leverages the skills, experience and commitment of its members to advocate the benefits of online advertising by acting as an authoritative and objective source for all online advertising issues whilst promoting industry-wide best practice.
IAB Australia is a registered not-for-profit organisation; membership fees and revenue generated is invested back into the IAB's membership benefits such as resources, events, reporting, and industry representation.
For further information about IAB Australia please visit: www.iabaustralia.com.au