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Native ads to account more than half of all US digital ad spend in 2017

David Murphy

Native digital display ad spend will make up more than half of all digital display ad spending in the US this year, according to a report from eMarketer.

In its first estimate of the size of the native advertising market, eMarketer said that US native digital display ad spend will reach $22.09bn in 2017, accounting for 52.9 per cent of all display ad spending in the US.

“Growth of native digital display is being driven by publishers’ pursuit of higher-value and more mobile-friendly inventory, as well as by advertisers’ demands for more engaging, less intrusive ads,” said, author of a new report that highlights the forecasts.

The vast majority of US native display ad spend currently goes to social networks, driven mainly by Facebook. This year, native social network display ad spend will reach $18.59bn, equating to 84.2 per cent of all US native display.

Since native advertising is largely bought on social platforms, it’s also almost entirely mobile. Native mobile display ad spend will reach $19.5bn this year, representing 88.3 per cent of all native advertising, and the share is growing. Native mobile will represent 64.5 per cent of all US mobile display ad spend this year.

But according to eMarketer principal analyst Lauren Fisher, social’s share of native is falling. “We’re seeing a huge ramp up in non-social publishers adopting in-feed ads and video,” she said. “Coupled with continued advances on the programmatic native front, this will accelerate non-social native display spending.”

Nearly all US native display ads are purchased programmatically, thanks to the heavy influence of social ads, the vast majority of which are transacted via APIs. This year, native programmatic will represent 84 per cent of all native digital display ad spending, or $18.55bn. However, excluding social, programmatic accounts for under half of all native non-social display ad spending.

“It’s been a slow start to enabling programmatic buying for non-social native display ads, but with the majority of buying platforms quickly moving to accommodate native ads, we see that changing in the next several months,” Fisher said.

In a separate report, eMarketer forecast that global digital ad spending will grow by 17.4 per cent this year to reach $223.74bn, representing 38.3 per cent of a total media ad spend figure of $583.91bn for 2017. Facebook and Google will continue to dominate the digital market, with Google’s global revenues jumping 17.8 per cent this year to take a 33 per cent share, while Facebook’s will grow by 35 per cent to take a 16.2 per cent share.

Following its recent IPO, eMarketer is predicting significant worldwide growth for Snapchat. In 2017 Snapchat’s global ad revenue, which is made up entirely of mobile display, will grow by 163.3 per cent to $900.0m. On the global scale, however Snapchat’s ad business remains small. In 2017, it will account for just 0.6 per cent of the global mobile ad market, rising to 1.4 per cent by 2019.