Report: Social media overtakes print to become the third-largest advertising channel
- 08 October, 2019 09:51
Advertisers will spend more on social media platforms than on print for the first time this year, according to the latest Zenith Advertising Expenditure Forecasts.
Advertising expenditure on social media will grow 20 per cent this year to reach US$84 billion, while advertisers’ combined expenditure on newspapers and magazines will fall six per cent to US$69 billion.
Social media will be the third-largest channel for advertising this year, with a 13 per cent share of global ad spend, behind television (29 per cent) and paid search (17 per cent). Its growth is slowing as it matures, and is forecast at 17 per cent in 2020 and 13 per cent in 2021, when it will account for 16 per cent of all global ad spend. Zenith reports paid search advertising will exceed US$100 billion for the first time, globally.
While global ad spend growth will remain steady at 4.4 per cent a year to 2021, in Australia, ad spend growth is expected to sit below the global average, at 2.8 per cent year on year ($17.1bn).
Locally, search ad spend is expected to increase by an average of 3.7 per cent each year until 2021, at which point it will represent 25 per cent of total ad spend at $4.3 billion.
In addition, linear broadcast TV will account for only 20 per cent of Australia's total market spend by 2021, equivalent to $3.5 billion.
Zenith head of investment Sydney, Elizabeth Baker, said it has been a tough year for the linear TV sector in Australia, which appears to be bearing much of the brunt of marketing budget contraction, particularly across the banking, auto, and food categories.
“To reflect the economic environment and in consideration of latest SMI ad spend data, we have revised our 2019 TV forecast to -3.3 per cent. However, we should start seeing more stability in revenue as we cycle against a weaker 2018 back quarter," she said. “In better news for our TV networks, BVOD revenue is booming and we anticipate growth will continue as measurable trading across linear and BVOD content is enabled via the launch of VOZ in 2020."
Television advertising also continues to suffer from shrinking ratings in most key markets, and will slip from US$182 billion in 2019 to US$180 billion in 2021, accounting for 27 per cent of total ad spend in the latter year.
In contrast, Baker noted social is in a state of transition, with international platforms like TikTok, Pinterest and Twitch gaining significant traction among younger audiences, representing new opportunities for brands.
Ad spend growth is also slowing in Asia-Pacific, with 4.4 per cent growth forecast for 2019, after 6.9 per cent growth in 2018.
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