The digital advertising spending in the US will grow up to 6% in 2020, despite the downswing in the broader ad market, claims IAB.
It is no secret that businesses are rapidly shifting their strategies to stay up and running, being forced to restructure functionalities in the current business circumstances. Overall, there has been a sluggish performance on the advertising spend growth globally, as brands have been cutting down on their budgets.
Lately, there has been a comparatively optimistic spending outlook in the digital media – as more marketers are prioritizing online platforms, social media marketing, and search. In the midst of the pandemic, both businesses and consumers have increased their digital media and internet consumption.
According to the recent IAB study, advertising professionals have projected that the spending on digital advertising in the US market will surge to 6% in 2020. This is contrasting with the decline of about 8% for the comprehensive ad market. The spending on traditional media – including linear TV, print, out-of-home, direct mail, standard radio, etc. will drop by nearly 30%.
Many media buyers have either a “very clear” or “somewhat clear” plan of their 2021 budgets and noted that their ad spending would increase by 5.3%. In the digital advertisement category, the estimations, as indicated by IAB, are: paid search is fastest rising with 26%, followed by social media with 25%.
The list follows with connected TV, digital video, and digital display. Expenses on many digital channels will dip this year, comprising a 43% drop for the digital OOH, an 8% drop for podcasts, and about 5% fall for digital audio. Even the CTV spending had been anticipated to reach $10.8 billion by 2021 – up from $7 billion in 2019, claimed eMarketer.
This is because more viewers canceled their satellite and cable subscriptions, switching to ad-supported options like Hulu, Roku, etc. CTV practice increased as more consumers sought other digital options while stuck at home amid the lockdowns. Nielsen confirmed that this behavior has reflected globally and remained elevated throughout, evading the time spent on linear TV.
Furthermore, Facebook earlier announced slower revenue growth in the second quarter, and is now seeing signs of a recovery with time. Even Google indicated a downswing in the ad revenue for the first time in its 26-year history. The IAB study forecasts say that the uptick on digital expenditure is progressive for Google and various social media platforms – including Facebook, Twitter, Instagram, TikTok, Pinterest, and Snapchat.
Clearly, the ad spending will soon return to normal, with more marketers upgrading their efforts and strategies.