Internet overtakes Newspaper advertising spend

 

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ZenithOptimediamedia have just published the latest quarterly edition of their global Advertising Expenditure Forecasts.

“The internet continues to exceed our expectations for growth, most recently thanks to the explosive growth in social media advertising. Online video is the other star in the category …….”

 

From their forecasts the annual compound growth rate of all advertising is predicted to be about 5% pa. (This is also confirmed by an Aegis Group press release  today showing nearly 6% in both 2012 and 2013).

The Internet element is growing we calculate at just over 16.25% per annum. No other category has double digit growth and the second highest medium is Cinema at around 7% and it accounts for less than 1% of the total market.

“Overall, we predict internet advertising will increase its share of the ad market from 16.4% in 2011 to 22.1% in 2014. Internet advertising already accounts for more than 25% of total ad expenditure in five markets (Denmark, Norway, South Korea, Sweden and the UK), and by 2014 we expect it to account for more than 30% in six markets (Canada, China, Norway, South Korea, Sweden and the UK), so there is plenty of potential for further growth in internet advertising’s global market share.”

In 2011 Internet advertising was in third place behind Television and Newspapers. It looks as if it will overtake Newspapers sometime during this year and be ahead of it by 2013. This is confirmed also today by Carat  “Digital will gain further strength in 2013, when online investment will overtake newspapers for the first time, fueled by consumer appetite for online video and social media, and the increasing penetration of mobile internet access. ”

The impact on the Newspaper industry is highlighted today by the announcement of Trinity Mirror plc’s latest results with the FT commenting that their shares have lost 90% of their value over the last five years.  If further evidence was needed the Newspaper Association of America have just published their advertising revenue figures for 2011 showing a reduction of 9.2% which even after offsetting an increase of 6.8% in their online revenues still leaves them 7.3% down which is an acceleration over the 2010 figure of 6,3%.

Internet Display advertising, which includes video, is forecast to grow compound at 22% a year compound ahead of Paid search (14.4%) and Classified (8.3%).

Advertising Age in the US even run a weekly Top 10 Viral Video Ad chart.  Here’s number 5 which has already had 4.5 million views.

 

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