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Mobile Monday: Top Takeaways from the IAB’s Advertising Revenue Report

Posted May 1, 2017

In this edition of Mobile Monday, we’re exploring what the IAB’s latest internet advertising revenue report means for both mobile advertisers and publishers.

Mobile Driving Digital Growth
While the overall digital ad spend growth of 21.8% in 2016 is notable in its own right, the story becomes more interesting when the data is broken into desktop and mobile. For the first time since 2009, non-mobile digital advertising fell in 2016, experiencing a 7.3% decline. Meanwhile, mobile advertising grew 76.8% in 2016. As a result, mobile advertising now accounts for a majority of all digital advertising spend.

This growth is also showing no signs of slowing down, as the 76.8% growth last year was even higher than the 65.6% growth seen in 2015 and the 76.1% growth seen in 2014. This translate into an 87% CAGR in mobile between 2011 and 2016 during a time when non-mobile advertising had a meager 6% CAGR.

Banners Decline as Search Shifts
As mobile’s share of total digital ad spend has increased year-over-year, so non-mobile search and banner ads have declined. Indeed, while desktop banner ads accounted for 16% of all digital ad spend in 2015, they only accounted for 12% of budgets in 2016. This 25% loss in share is overshadowed, however, by the decline in desktop search ads. Once 34% of all digital ad spend, search now only accounts for 24% of budgets.

Interestingly, the story was slightly different for these formats within mobile settings. While mobile banner ads saw a decline from 45% to 38% of mobile ad spend share, search ads grew slightly from 44% to 47%. From this, it may be inferred that while banner ads are growing out of favor across the board, search ad budgets are shifting from desktop to mobile.

Video Drives Ad Revenue
With other formats on the decline across desktop and mobile, only mobile video has consistently driven increased advertising revenue since 2008. While digital video was relatively flat, other less immersive ad formats have shown steady declines each year between 2008 and 2016. As a result, mobile video now accounts for 46% of the $9 billion in digital video revenue publishers enjoyed last year.

Why is this? Simply put, the trend is toward immersive formats on personal screens, not lackluster search or banner placements.

About the Report
Conducted by PricewaterhouseCoopers Advisory Services and published quarterly by the IAB, the IAB Internet Advertising Revenue Report utilizes data both reported directly to PwC as well as information that is publicly available or provided by online ad selling companies. The report covers both desktop and mobile online advertising data.

About AdColony Mobile Mondays
Mobile Monday examines the latest news, trends, and developments in mobile apps, tech, and advertising. Do you have a story to share for the next Mobile Monday? Tweet it to . For the latest AdColony mobile news and updates, follow  on Twitter, like us on Facebook, or connect on Linkedin.

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