The Australian online advertising market grew nearly 12 per cent over the last 12 months, reaching $7.6 billion for the full financial year ending 30 June, according to the latest IAB figures.
Among the interesting trends, mobile now accounts for a half of all online display ads, and the rivers of gold continue to shimmer, with the local classifieds performance beating many global peers thanks to all of those irrational property investors.
Video likewise had a strong result.
“Online advertising continues to deliver robust double-digit growth and now accounts for close to 50 per cent of advertising spend in Australia,” noted Megan Brownlow, Editor, Australian Entertainment and Media Outlook at PwC. “Digital is now a grown up and established advertising medium and the continued evolution of video and mobile advertising. Video in its own right is approaching a billion dollar business as more brands are realising the benefits of combining the persuasive brand-building capabilities of video with the precision targeting that digital affords.”
The data from the latest IAB/PWC Online Advertising Expenditure Report reveals that all online advertising categories experienced double-digit growth in 2017.
General Display: Mobile represents over 50 per cent of display dollars for the first time, whilst video advertising is rapidly increasing its share, up 49 per cent to $0.9 billion — a third of the total display market.
The auto category was once again the number one display category in 2017 and saw the largest year-on-year growth, increasing from 17 per cent of category share in 2016 to 18.5 per cent in 2017. Automotive, Real Estate and Retail categories together account for 41.1 per cent of the General Display advertising market.
Classifieds: This category continues to grow faster than other global markets due to the strong local Australian pure plays. Classifieds grew more than Display and Search, up almost 15 per cent year-on-year.
Mobile advertising highlights
Mobile advertising expenditure now exceeds $2.6 billion, an increase of $641 million (or 32.7 per cent) compared to 2016. Of this $2.6 billion expenditure, 46 per cent was attributed to mobile search and 54 per cent to mobile display. Seventy per cent was attributed to smartphones and 30 per cent to tablets.
Video advertising highlights
Video advertising now accounts for $894.4 million of expenditure, up $294.4 million (or 50 per cent) compared to the previous year. It now makes up 32.9 per cent of General Display advertising expenditure, compared to 24.3 per cent in 2016.
“As mobile and video advertising continues to drive the growth in online advertising, IAB Australia is committed to helping brands, agencies and publishers improve their understanding of the mediums,” added Vijay Solanki, CEO of IAB Australia. “During the last quarter alone, the IAB Video Council has published its inaugural Connected TV White Paper and the Video, Audio and Mobile Councils have published new Glossary of Terms to equip marketers with a common understanding of metrics and terms — with much more to come before the end of 2017.”
Q2 2017 Expenditure Highlights
In the three months ended 30 June 2017, total online advertising was $1.9 billion, representing a year-on-year growth of 5.2 per cent and increase of 2.9 per cent from the prior quarter.
All categories experienced growth compared to the same quarter in the prior year, with Classifieds delivering the strongest growth at 18.5 per cent.
Mobile advertising stands at $721 million for Q2 and comprises General Display and Search expenditures — with 51 per cent attributed to Mobile Display and 49 per cent to Mobile Search. Mobile contributed 54.7 per cent of General Display expenditure, marginally growing its contribution from 53.5 per cent in the March 2017 quarter.
Video remains a significant component of General Display advertising. While year-on-year growth remains strong, up 32.1 per cent, video advertising expenditure experienced a softening in growth in the June quarter compared to the March quarter 2017 — up 1.5 per cent, consistent with the trends seen in the broader advertising market.
Automotive and Real Estate led the General Display market in the June 2017 quarter, representing 36 per cent of the reported General Display advertising market. These are the only two categories with a greater than ten per cent share, followed by Retail at 7.6 per cent. Automotive has been the leading category for over five consecutive years.