IAB: Australian digital advertising market increases to $8.8 billion in 2018

Shift in consumer media consumption underpins strong growth in digital advertising

The Australian online advertising market hit $8.8 billion expenditure in 2018, an increase of 11.6 per cent on 2017.

According to the IAB Australia Online Advertising Expenditure Report (OAER) published by PwC, the strong results for the digital advertising market in 2018 is underpinned by the continuing shift in consumer media consumption. 

Australians now spend nearly 100 hours a month on desktop, smartphone, and tablets and nearly five million people access internet content on their TV screens daily. For marketers, the use of technology and strength of content will be pivotal in differentiating publishers.

For the full calendar year 2018, the general display advertising category experienced considerable growth, reaching $3.3 billion for the year, a 15.8 per cent increase on 2017. This places the category at 37 per cent of total online advertising – the strongest share of the overall online ad market to date.  

Video was again the bright spot, making up 42 per cent of the general display market and up 26.2 per cent on 2017 to reach $1.4 billion in 2018, demonstrating the continued positive trend for publishers as brands continue to seek premium environments in which to showcase their offerings.  

For calendar year 2018, mobile advertising continued to drive strong growth in both general display and search and directories, reaching $4.2 billion in 2018, a 34.9 per cent increase year on year. Mobile advertising now makes up 63 per cent of total general display advertising.   

Search and directories hit $3.4 billion for 2018, a 9.2 per cent increase, while classifieds increased 9.5 per cent to reach $1.6 billion spend in 2018.

For the quarter ending 31st December 2018, the general display advertising category grew 5.4 per cent to a market total of $2.3 billion and, 51 per cent of this inventory was bought via media agencies using either an insertion order or another non-programmatic method.

Of the balance, 34 per cent of general display advertising was bought programmatically with either fixed CPM or guaranteed inventory (9%) or a variable CPM based on real time bidding via an exchange or private market place (25%), while nine per cent of all display advertising was bought directly.   

With connected TV inventory now a significant part of the digital video market, in Q4 2018, 23 per cent of video advertising revenue for content websites was generated by connected TV inventory, while 48 per cent of video advertising revenue for content websites was via desktop, and 29 per cent via mobile video advertising.      

Gai Le Roy, CEO of IAB Australia, said marketers continue to reinvest their budgets in a range of digital advertising options because they know it helps grow their businesses.

“2019 will see the IAB demonstrate to marketers how they can increase the effectiveness of their spend across a wide range of digital formats and how it can work together efficiently with other media channel investments,” she said.    

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+:google.com/+CmoAu     

 

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