Video, mobile show strong growth in IAB's Q1 online advertising report

Latest IAB report on online advertising expenditure in Australia shows digital advertising to be worth $1.15bn in the first three months of 2015

Video and mobile advertising both experienced double-digit growth in the first three months of the year as digital advertising spend reached $1.15bn, IAB’s latest report reveals.

According to the first 2015IAB Online Advertising Expenditure Report produced by PricewaterhouseCoopers, digital advertising spend reached $1.15 billion in the three months to 31 March 2015, a 5 per cent increase year-on-year.

Video advertising was the star of the show in Q1, chalking up 79 per cent year-on-year growth to $77 million. Mobile advertising also accelerated, leaping 13.5 per cent year-on-year to $230 million.

One in three general display dollars were spent on mobile display, while phone-based advertising lifted 20 per cent between Q1 2014 and Q1 2015, and tablet revenue grew 6 per cent over the same timeframe. As a whole, mobile advertising expenditure now makes up 20.1 per cent of total online advertising expenditure, up from 17.4 per cent last quarter.

According to IAB’s <i>Third Annual Mobile Landscape Study</i> released in April, mobile advertising is now well entrenched in the digital marketer’s budget, with 41 per cent of respondents using mobile as a core component in marketing campaigns.

In a sign of the growing dominance of online advertising, IAB’s report also pointed to the latest Commercial Economic Advisory Service of Australia (CEASA) Advertising Expenditure in Main Media report, which showed digital advertising spend representing 36 per cent of Australia’s $12.8bn advertising market in 2014. This was up from 31 per cent in 2013.

In contract, free-to-air advertising represented 27 per cent of total marketing spend, down 1 per cent; newspapers represented 16 per cent, down 3 per cent; and radio was 8 per cent.

IAB Australia’s CEO, Alice Manners, noted the strong video performance and expected further growth both locally as well as globally.

“The increase in video advertising expenditure is a reflection of the overall growing market understanding of the consumer’s desire to access content across a range of screens, all the time and at any time,” she said.

“The recent IAB NewFronts in New York saw a record number of major players unveil their new content offerings to an industry audience of unprecedented scale. It’s clear the industry is heavily investing in video content and we expect to see this continue to translate into ongoing growth in video here and in every other major market worldwide.”

The IAB’s new report also showed strong growth across general display advertising, which recorded its thirteenth consecutive year-on-year increase since 2002. General display accounted for 34 per cent of total online advertising spend and was worth $388m in the first quarter of the year. Top spenders on general display are motor vehicle, real estate and finance categories.

Search and directories remain the top category, with 44 per cent of the total online market worth $504m, while classified represented 22 per cent, an increase of 18 per cent year-on-year to $255m.

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