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Digital advertising revenue in the U.S. rose 23% year over year (YOY) to $49.5 billion during the first half of 2018 (H1 2018), according to a recently published IAB report. Ad spending is generally higher during the second half of the year, allowing projections of total ad revenue eclipsing the $100 billion mark by year end. For the full 12 months of 2017, total U.S. media ad revenue was $88 billion.
Mobile Ad Spend Is Leading the Growth
Approximately two-thirds of the digital media spend during H1 2018 was for mobile ad units. At $30.9 billion, mobile ad revenue was up 42% year over year and up ten-fold from H1 2013.
Almost one-quarter of consumers access the internet exclusively from mobile devices and almost three-quarters of all internet time is spent on mobile devices. However, mobile ad revenue accounted for just 63% of all digital ad revenue in H1 2018, showing clear room for continued expansion.
Mobile advertising revenue for video units grew 61% YOY in H1 2018. Banner advertising revenue on mobile devices grew 45% YOY and accounted for almost three-quarters of the banner channel’s ad revenue.
Social Ad Revenue Set to Cross $25 Billion
In just four years, social media advertising revenue grew 352% — from $2.9 billion in the first half of 2014 to $13.1 billion in H1 2018. Based on the current speed of social media ad spending, 2018 will mark the first year social ad revenue crosses the $25 billion mark.
Video Ad Revenue Also on Fast Trajectory
With 220 million users streaming 47 billion videos each month, the video channel has become popular with advertisers. Over the past three years, video ad revenue climbed 169% — from $2.6 billion in H1 2015 to $7.0 billion during the first half of this year. CPMs for in-stream videos rose 5% YOY to $25.63 for the period of July 2017 to June 2018.
Though a smaller market, audio ad revenue also scaled, more than doubling in two years from $425 million in H1 2016 to $935 million in H1 2018.
Ad Spend on Traditional Media Is Flat
In Q2 2018, while digital advertising revenue climbed 23%, traditional media ad revenue grew just 1%. Cable and broadcast TV ad revenue both rose in H1 2018 (up 16% YOY for cable and up 5% for broadcast), but radio, newspaper and magazine ad revenue slipped (3%, 8% and 15% respectively).
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