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BizReport : Advertising archives : November 04, 2019

Forecast: Global ad spend to push $1.3T in 2020

Look for a good-sized increase in advertising spending in the new year. That's the word from PQ Media's Global Advertising & Marketing Revenue Forecast, which predicts that the overall ad spend will increase nearly 5% to hit at least $1.3 trillion, with revenues from ads hitting at least $1.3 trillion by the end of 2019.

by Kristina Knight

Despite the fact that advertising growth saw a slowdown during the last half of Q4 2019, experts from PQ Media are predicting a record-setting 2020 for the advertising space, with the ad spend expected to hit at least $1.3 trillion. That would be a 5% increase over 2019 advertising levels.

Much of that increase is being driven by digital, according to PQ Media's forecast, with digital and alternative revenues up 11% in 2018, and accounting for about one-third (38%) of all marketing revenues. This is expected to push more advertising dollars into social marketing, mobile, and even influencer spending.

"While digital & alternative media operates in a complex ecosystem that includes alarming fraud levels, shifting social media algorithms and disorderly measurement systems, brand marketers will continue to invest in media strategies and tactics that can prove engagement with elusive non-Boomer target audiences," said PQ Media President Patrick Quinn. "As they seek to navigate the changing media landscape, brands are turning to digital media on the premise that it will offer higher consumer engagement, such as mobile video, audio and games that create consumer buzz; influencer and content marketing to control the conversation; and product placement and OTT advertising to capitalize on hot new streaming video programs."

Other interesting predicts from PQ Media include:

▪ The 5% expected advertising growth rate would be the highest in 10 years
▪ US ad revenues hit $502 billion in 2018
▪ Japan, China, UK, and Germany rounded out the top five ad revenue markets
▪ Of the digital options, online search accounts for $52.8 billion

More data from PQ Media can be accessed here.

One of the hot-spots in digital? Streaming, and it isn't slowing down. According to new data from Conviva the time-spent streaming television, movies and other content is up 53% YoY with about two-thirds of people (63%) streaming 'on demand'.

"Streaming is quickly becoming the new normal. As a result, we will continue to see new upstarts in the category accompanied by traditional media companies and big brand advertisers embracing the potential of the market," said Bill Demas, CEO, Conviva. "This is an industry undergoing massive growth and what happens in the next 18 months will shape what, how and when we watch content in the future."

One issue for streaming: advertising. While connectivity and buffering issues have been improved on for video start times and there are fewer video start failures, Conviva's experts found that more than one-third of ad starts failed in Q3, with start times and buffering taking up 16 seconds of consumers' time, a problem when streaming consumers have been show to want a seamless viewing experience.

More data from Conviva's State of Streaming Q3 2019 report can be found here.

And the spend for ecommerce continues to skyrocket. According to Marin Software ecommerce ad spending is up 115% YoY. They also found that nearly half of the ecommerce spend is going to mobile search (47%), as a growing number of shoppers have begun conducting local searches from mobile devices. About 40% of digital budgets are spend on shopping ads.

"Amazon continues to impact and shape advertising trends and this quarter is no exception. Our customer base reached a new quarterly high in eCommerce ad spend, due in part to a record-breaking Prime Day and a strong back to school season," said Wes MacLaggan, SVP of Marketing for Marin Software. "While we expect the eCommerce segment to continue to grow as competitors try to gain more market share, we're also keeping our eyes on non-eCommerce features that are set to shake up the industry, such as Instagram Explore Feed and Facebook Watch, which offer marketers the chance to capitalize on what's culturally relevant and trending. As we enter the busy Q4 season, the smartest marketers will drive performance by optimizing campaigns for each unique platform while connecting the dots across channels."

Marin's Digital Advertising Benchmark, Q3 2019 report can be accessed here.

Tags: advertising, Conviva, ecommerce ad spend, ecommerce advertising, email marketing, Marin Software, mobile marketing, PQ Media, social marketing, video ad trends

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