According to the Social Media and SEO importance growth that took place on last years, the online ad spending was obviously growing as well, by generous rates, but from end of 2016 we can see that the trend is starting to brake.
While platforms like Snapchat are still getting the reward of their own hit, as it is one of the most popular apps right now (even overcoming Pinterest), most of online Social Media and Search Engines are checking how digital investment reached a great importance within marketing budgets, but starts to brake that mad growth we were used to.
It appears that digital’s up-and-to-the-right trajectory of the past several years hit a bit of a lull in 2016. According to a report by advertising intelligence firm Standard Media Index (SMI), spending growth on digital advertising slowed to 13.3 percent year over year, compared to the sharp 26.2 percent growth seen in 2015 over 2014.
From 2012 to 2015, digital has had a 19 percent compound annual growth rate. The fourth quarter of 2016 saw growth of just 7.1 percent compared to the previous year.
Among the second-tier networks, Snapchat stood out in 2016, with ad spend growing 356 percent year over year. Snapchat surpassed Pinterest, which had seen 8 percent higher ad spend than Snapchat in 2015. In 2016, spend volume was 167 percent greater on Snapchat than Pinterest. Pinterest saw spend volume grow 58.2 percent year over year.
As digital growth tempered, SMI found several brands put more into TV in 2016, which saw both the summer Olympics and presidential election. Q4, in particular, saw brands shift back from to TV from digital. After cutting TV spend in 2015, Paramount Pictures, Target and Progressive Insurance were among the large brand advertisers that increased TV ad spend in 2016.
Sectors that did see digital spend growth in 2016 were movie studios (up 40 percent); food, produce and dairy (up 36.5 percent); alcoholic beverages (up 33 percent); and prescription medications (up 26.7 percent).
SMI says its data accounts for roughly 80 percent of all ad spend among the major agency holding companies by sourcing directly from the media-buying firms.
Ade Camilleri is a leading Internet marketer and Data Marketing Analyst for some of the worlds leading Comapnies with a focus on Tourism, Public Companies, Government Organmisatioons and iGaming. He forms part of the Media Plan group of Copmpanies who provide Digital Marketing Services for iGaming, Tourtism and Fortune 500 Companies.