The investment management firm GroupM said Sunday that the dominance of Facebook and Google “is exceedingly bad news for the balance of the digital publisher ecosystem.”
Facebook
and Google will capture a phenomenal 84 percent of the digital ad spend
worldwide this year as the two online companies account for all of the
growth in internet advertising this year, according to GroupM.
The investment management firm said Sunday that the dominance of
Facebook and Google “is exceedingly bad news for the balance of the
digital publisher ecosystem.” Since the two firms are not only grabbing
all the new money advertisers are spending but are also taking share
from the competition, GroupM says they will account for “186 percent of
digital growth in 2017.”
GroupM’s data strips out China, since media is heavily regulated there
and the country is immaterial to both Google and Facebook.
With China, digital advertising will increase overall 11.5 percent this
year and will capture 34.1 percent of all spending, while television
grows at a mere 0.4 percent, though when state-controlled China is
included TV will grow at 3 percent. Worldwide, TV still dominates with
41 percent of ad share.
But in a separate study from Zenith Media also released Sunday, internet
advertising has overtaken television on a global basis, accounting for
37.3 percent compared with 34.3 percent. Zenith says that TV peaked in
2012, when it accounted for 39.3 percent of all advertising.
Zenith also says that “the effectiveness of internet advertising has now
caught up with digital ad spend,” given its “brand experience” (Zenith’s
term it says is an accurate proxy of market share) has hit 35 percent.
In 2014, for example, advertisers spent 27 percent of their budgets on
the Internet but it only bought them 21 percent of brand experience.
Zenith says the internet’s share of advertising globally will reach 40
percent next year and 44 percent in 2020, when it hits $225 billion in
ad spend.
Zenith predicts that overall advertising among all media worldwide will
grow 4.1 percent in 2018, reaching $578 billion by the end of that year.
GroupM, though, says advertising will hit $535 billion worldwide this
year and $558 billion next year. In the U.S., advertising on the whole
will come in at $183 billion this year and $189 billion next year.
By medium in the U.S., TV will grow 3 percent to $81.9 billion in 2018;
the internet will grow 10 percent to $62.5 billion; print will shrink
nearly 7 percent to $32.3 billion; radio will grow 3 percent to $7.9
billion; outdoor will grow 3 percent to $4.6 billion and cinema
advertising will grow 2 percent to $40 million, according to GroupM.
By medium worldwide, TV will grow 2 percent to $217.1 billion in 2018;
the internet will grow 11 percent to $202.8 billion; print will shrink 5
percent to $77.9 billion; outdoor will rise 6 percent to $35.1 billion;
radio will grow 2 percent to $23.7 billion; and cinema will grow 3
percent to $1.4 billion, according to GroupM.