Video advertising growth a key driver in double-digit Q4 growth and the overall 2 per cent increase in digital advertising spend recorded in 2020
Australia’s digital advertising market experienced a robust comeback during the last quarter of 2020, reporting nearly 30 per cent spend increases compared to Q3 and over 20 per cent growth year-on-year buoyed by significant video advertising spend.
The latest Interactive Advertising Bureau (IAB) Australia PwC Online Advertising Expenditure Report shows digital advertising spend reached $9.5 billion in 2020, including $2.9 billion in expenditure in Q4. The Q4 result represented a 20.3 per cent increase compared to the same quarter in 2019.
And despite the disruption and concerns around advertising spend as a result of the COVID-19 global pandemic, IAB’s figures show digital advertising spend in fact grew 2 per cent year-on-year.
Across Q4, both general display and search chalked up significant year-on-year growth, up 26.8 per cent and 21.1 per cent, respectively. This saw display’s share of digital ad spend increase 2 per cent on 2019 to 41 per cent. IAB said all display formats saw an increase compared to the prior year, a sign of strong diversified investment for the quarter.
Video advertising investment led the way, with a 41 per cent increase noted in IAB’s results compared to the same quarter last year, reaching $642.7 million in Q4. Across 2020, video advertising spend reached $1.9 billion, up 17.2 per cent on 2019.
The rise of video advertising was noted in last week’s Finaria.it global ad spend figures produced by Statistica, which reported video ad spend jumped by nearly 10 per cent year-on-year to US$33.2 billion amid the COVID-19 pandemic and was expected to rise to $37.4 billion in 2021. By 2025, projections show global video advertising climbing to $45.5 billion by 2025.
In addition, IAB’s recent Attitudes to Digital Video Report showed 68 per cent of agencies expect investment in digital video advertising to increase in 2021. Nearly six in 10 respondents said the ability of digital advertising to reach audiences at scale was the main reason why they were continuing to use or recommend digital video advertising. What’s more, 94 per cent of those using digital video for increasing brand awareness expressed satisfaction with campaign results.
“Digital advertising saw a robust comeback in the second half of the year with an extraordinarily strong December quarter with marketer demand flowing across all inventory types,” IAB Australia CEO, Gai Le Roy, said. “The combination of delayed marketing spend, traditional seasonal uplift, news of a COVID vaccine and increased consumer online media and commerce behaviour all contributed to the stellar quarter.”
Across categories, retailers proved to hold a record share of display investment over the quarter, representing 18.5 per cent of the market against 11.7 per cent the prior year. In a further reflection of the unique conditions experienced in 2020, investment by auto advertisers continued to lag the rest of the market with share sitting at 10.8 per cent in 2020, down nearly 4 per cent on 2019 and nearly 12 per cent in 2018. For the full year, automotive represented 12.4 per cent share of digital display advertising spend, down from 21.5 per cent in 2019.
By contrast, retail was up from 10.1 per cent in 2019 to 15 per cent in 2020. Unsurprisingly, technology was also up by 3.7 per cent to represent 6.6 per cent of total display expenditure. Finance was also up as a category by 1.2 per cent to 9 per cent in 2020, as was FMCG, which lifted 2 per cent to 6.9 per cent of total spend.
Overall, display represented $3.7 billion of total 2020 spend, while search and directories sat at $4.3 billion. Mobile was another strong performer, rising by 3.7 per cent to be worth $5.2 billion in 2020.
The loser was classifieds, which fell by 7.3 per cent compared to 2019 to sit at $1.5 billion of total digital advertising spend in 2020.
IAB noted content publishers saw more inventory purchased through programmatic methods, with programmatic real-time bidding, PMP and guaranteed representing 44 per cent of display revenue generated in 2020 compared to 36 per cent in 2019. CTV share of video was also up, rising by 10 per cent to represent 45 per cent of content publishers’ video investment in 2020.
The IAB figures were echoed in similar digital advertising results reported earlier in February by Standard Media Index A/NZ showed an end-of-year surge lifting digital ad spend out of the COVID-induced ad recession to lift overall spend 2 per cent year-on-year.
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Tags: market researchdigital marketingdigital advertisingInteractive Advertising Bureau (IAB) Australiadisplay advertisingvideo advertisingcovid-19
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