US digital ad revenues surge to $40bn in H1 2017


US digital ad revenues for the first half of 2017 surged to an all-time high of $40.1bn (£30bn), according to the latest IAB Internet Advertising Revenue Report released by the industry trade group and prepared by PwC US. The figure represents a 23 per cent year-over-year rise from the $32.7bn reported during the same timeframe in 2016.

Mobile captured 54 per cent of total digital ad revenues, maintaining its status as the web’s leading ad format. Advertisers spent $21.7bn on mobile during the first six months of 2017, a 40 per cent increase from $15.5bn in H1 2016 and far surpassing the $8.2bn reported in H1 2015.

In an addendum to the report, IAB analysis shows that of the roughly 9m small and medium-sized businesses in the US, 75 per cent or more have spent money on advertising. Of these, 80 per cent have used self-service platforms and 15 per cent have leveraged programmatic advertising. The IAB said that these findings point to significant ad spend going to publishers with these capabilities, and present a growth opportunity for those that can add self-service and programmatic geared to these businesses into the mix.

Total digital video spend including mobile and desktop, rose to $5.2bn in H1 2017, up 36 per cent from $3.8bn in H1 2016. Video on mobile overtook video on display for the first time, with mobile video reaching $2.6bn in H1 2017, compared with display video, which was just sH1 of that same figure.
Total social media advertising, including mobile and desktop, brought in revenues of $9.5bn in H1 2017, a 37 per cent upswing over $7bn in H1 2016. Total digital audio advertising, including mobile and desktop, generated $603m in H1 2017, a 42 per cent increase over H1 2016’s revenue of $425m.

“We’ve seen digital marketing revenues climb steadily and this new analysis shows that there are more opportunities to be mined,” said Chris Kuist, senior vice president, research and impact at the IAB. “Varied audiences and advertising approaches can appeal to a wide variety of marketers in different shapes and sizes, bringing more dollars into the ecosystem and increasing the health of the interactive marketplace for all.”

David Murphy writes:
The digital, and specifically mobile marketing community will be delighted by these figures, but before anyone gets too carried away, two questions should be asked: how much of the spend actually ends up going to the media owners it was allocated to? And how much of that $40bn ends up in the pockets of fraudsters? 

These have been two of the biggest issues of 2017. I dont know how feasible it is for the IAB/PwC to break out non-fraudulent traffic in its figures, but if they were able to, it might paint a more realistic picture of the current state of the industry.