IAB Advertising Report Finds Marketers Can't Stop Spending On Digital

By Published on .

Most Popular

Digital advertising is on a relentless path toward gobbling up more ad dollars, with marketers spending a record-breaking $17.6 billion on digital in the third quarter of 2016. That represents a 20% year-over-year increase, according to a report released Wednesday by the Interactive Advertising Bureau.

Mobile takes off
Mobile takes off Credit: iStock/erhui1979

Excluding the fourth quarter, which is historically the highest quarter in terms of digital ad spending, marketers poured $50.3 billion in display, social, video and search advertising this year. To put that number in perspective, $59.6 billion was spent for the entire 2015 calendar year.

David Doty, exec VP and chief marketing officer at the IAB, said mobile and digital video is leading the charge in ad spending. "These record-setting third-quarter revenue figures reflect marketers' trust in the internet's power to connect with today's audiences," Mr. Doty said.

The IAB advertising report is released each quarter, but it only provides an in depth breakdown of ad spending every six months. This year, many at the IAB feel it is near absolute certainty that 2016 will be the year mobile finally overtakes desktop in digital ad spending.

According to the IAB's half-year report released in November, mobile represented 47% of all digital ad spending. The only format still seeing growth on desktop is video, while other areas such as display and search are all on the decline, the IAB said.

One key trend to watch as 2016 concludes is search advertising's growth. Revenue from desktop fell for the first time during the first half of 2016 to $8.9 billion, down 12% year-over-year. Mobile search revenue, however, grew 105% to $7.4 billion, up from $3.6 billion during the same time last year.

Search advertising composes nearly half of all digital ad spending.

Although the numbers indicate search ad dollars have shifted to mobile, its growth remained flat when compared to the first half of 2015. Perhaps stalling its growth are consumers who begin the discovery process in apps and not the open mobile web, where tech giants like Google dominate search queries performed by consumers.

The IAB's report is an industry survey conducted independently by the New Media Group of PricewaterhouseCoopers. It includes data concerning online advertising revenue from web sites, commercial online services, free email providers and other companies that sell online advertising. PwC does not audit the information and provides no opinion or other form of assurance regarding the information.