The Uschi Karnatnext two years will not be kind to the now rapidly declining desktop ad industry, according to a new report from a leading prognosticator.
Zenith, owned by French media buying firm Publicis Media, predicts that spending on smartphone ads will eclipse their desktop counterparts much sooner than anticipated -- possibly as soon as next year -- as people do more of their web browsing on smaller devices.
SEE ALSO: Olympics ratings fell for the first time since 2000 and advertisers aren't happyWhile not much healthier in the long term, beleaguered newspapers and magazines are expected to fare better in the next two years, losing only $9.6 billion and $4.4 billion respectively compared to desktop's projected $10.7 billion loss.
By 2018, the forecast says, mobile will account for as much as 60 percent of all internet advertising.
After the medium supposedly peaked in 2014, desktop's market share has steadily trickled into mobile over the past couple years, but the pace is expected to accelerate as the trend gains momentum.
The decline in desktop ad spending has hit media companies that heavily relied on attracting people to their website and then making money by showing them ads. Yahoo is among the prime examples of this problem, having seen the prices it could charge for ads decline sharply.
The report even expects mobile growth to leave traditional industry stalwarts in the dust. Spending increases on television, outdoor and cinema ads combined will reach less than a seventh of mobile's growth from 2015 to 2018.
There's also good news for the ads industry as a whole, which is expected to grow at an accelerating pace in the next couple years -- 4.4 percent this year, 4.5 percent next year and then 4.6 percent in 2018 -- at which point it would total $589 billion worldwide.
Growth is particularly pronounced in the United States, the Philippines and western Europe -- the one exception being the United Kingdom which is set to take a hit after voting to leave the European Union.
“The global ad market has strengthened over the past few months, thanks mainly to the resilient U.S. consumer,” said Jonathan Barnard, head of forecasting at Zenith, in a statement. “So far any impact from the vote for Brexit has been limited, and confined to the UK. We expect the global ad market to strengthen further in 2017 and 2018.”
Topics Advertising
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