By: Toni Fitzgerald
The rise of smartphones and tablets is doing more than just hurting traditional advertising.
It’s also draining money away from a more traditional form of digital advertising.
A new forecast from ZenithOptimedia, the London agency, forecasts a big boom in worldwide mobile ad spending over the next three years.
But it also forecasts a corollary drop in global desktop spending. At first the dips will be modest, but they’ll pick up quickly as advertisers abandon desktop for mobile.
From 2015 to 2018, total desktop spending will shrink by $10.7 billion. To put that in perspective, that’s more than either newspapers (off $9.6 billion in that span) or magazines (down $4.4 billion).
Mobile, meanwhile, will grow by $81.3 billion, or an incredible seven times as much as the top four traditional media (television, outdoor, radio and cinema) combined in that three-year span.
ZenithOptimedia notes that the shift to mobile from desktop is happening even faster than anticipated.
It upped its forecast to 48 percent growth this year and 33 percent next year.
“We now expect mobile adspend to exceed desktop by $8 billion in 2017, up from the $2 billion we predicted in June,” says the forecast.
By 2018, mobile will account for 60 percent of all digital advertising worldwide.
The shift to mobile reflects global online usage trends.
In the United States, mobile internet usage surpassed desktop a couple years ago. But it generally takes some time for ad spending to reflect usage.
Desktop advertising peaked two years ago, at $99 billion. It’s been declining since, and as advertisers become more comfortable with mobile campaigns, that shift will happen more quickly.
Other advertising trends
In addition to the migration of dollars from desktop to mobile, here are a few other notable trends from the latest global forecast:
-Advertisers are taking the Brexit vote in stride. Though there’d been some worry of advertisers getting spooked, ZenithOptimedia says “most of the impact that Brexit will have on the UK ad market will come in the long term” and projects steady growth of 5.4 percent in Europe this year.
-A stronger upfront, combined with spending from pharmaceutical and consumer packaged goods companies, will push broadcast TV advertising up 1 percent this year in the United States, after a 5 percent decline last year.
-Latin American ad spending will decline this year, reflecting recessions in Argentina, Brazil, Ecuador and Venezuela, but it will bounce back up slightly next year.
Author: Toni Fitzgerald