This year, local digital represents $66 Billion, while traditional represents $67.7 Billion. But in 2017, local digital will climb dramatically to $80.7 billion, while traditional falls to $62.9 Billion.

Per Borrell’s research, targeted banners make up 60% of the digital revenue; untargeted banners represent 9%; paid search represents 14%; and video represents 4%. “Other” represents 3%.

But targeted banners – absorbing the boom in mobile, which will outpace non-mobile revenues by 2018 – are set to go through the roof. By 2020, targeted banners will represent 83 percent of all digital revenue. While video’s share among the various channels will fall to 9 percent, Borrell reminds that it will actually be taking in a lot more money. We’ll be looking at an $8 billion pool, he says.

Borrell also says to look beyond advertising. Promotions are several times larger than advertising. Marketing services could be an even bigger opportunity, as many SMBs increasingly tend to sink their resources into website development and reputation management and other related services instead of buying advertising.

The turn to mobile was something that was highlighted at LOAC West by ComScore Chairman Gian Fulgoni. Rather than cannibalizing existing time spent on the Web and the size of the audience, mobile is actually increasing both, he says. It has also become a stronger advertising channel than desktop for many functions.

Mobile beats desktop in all the key areas because ads are delivered so much lower in the purchase funnel. It is 1.6X more valuable for “aided awareness; 2.1X more valuable for “likelihood to recommend”: and 2.3X for “purchase intent.”

Mobile campaigns also deliver comparable reach/frequency to desktop, and drive significant incremental reach. It is especially strong where mobile apps can “improve real world behaviors,” such as hailing cabs, exercising and dating. In fact, mobile saw a 59 percent growth for discretionary spending categories, compared to 17 percent for desktop. Mobile represented 19.8 percent of all discretionary spending in 2Q 2016.

As a transaction channel, however, mobile remains less effective on complex purchases that require several screens of information, larger pictures, and where there are concerns about security. While it is becoming more of a level playing field with larger mobile screens, etc. the best kind of mobile purchase remain for simpler purchases, such as video games, watches and toys.

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With positive economic signs at home and abroad, the advertising market is looking up. This year, according to the global forecast, the ad market is expected to grow a healthy 4.4% to $539 billion in total spending, according to a new report by Zenith Media, up slightly from Zenith’s June forecast of 4.1% annual growth.

Meanwhile, the U.S. ad market is similarly strong this year, with Zenith forecasting 4.4% growth in ad spend, powered by even-year events including the Summer Olympics and presidential elections.
Looking ahead, Zenith expects the U.S. market to slow slightly next year, but still post positive growth at 3.8%, followed by a 3.5% rise in 2018.

Radio ad spending is expected to reach $17.57 billion this year, flat with last year, and the medium is anticipated to hold steady through 2018. Zenith’s projections include network radio, which attracted $1.17 billion in ad spend in 2016, and local radio, which accounted for $16.4 billion.

Among radio advertising categories, Zenith says spending is strong by telecom, retail, restaurants and insurance-health care clients. And while radio broadcasters have been hopeful about increasing their share of political advertising this year, Zenith says radio stations are still waiting for that potential windfall, which should come later this fall.

Of radio stations’ hopes for more political ad dollars, the report notes: “Many are counting on this to make budgets. The majority of political spend continues to favor TV, but in some key battleground markets, radio could take the overflow from sold-out TV news dayparts.”
Among media, digital is posting the strongest advertising gains. “Digital, particularly mobile, continues to take dollars away from print media as consumers use mobile apps and other outlets to consume content digitally,” the report notes.

Total digital ad spending is estimated to hit $60.3 billion in 2016, up from $51.6 billion a year ago. Looking ahead, Zenith projects digital media advertising will reach $78.2 billion by 2018. Among digital subcategories, Zenith says demand is strong for social media advertising, digital video and mobile.
But while demand for digital continues to grow as marketers look to reach consumers across Internet platforms, Zenith cautions that brands will demand that digital platforms prove out ROI, just like other media. “The promise of digital hinges upon accurate measurement and analytics wherewithal. As dollars move to digital, they need to be supported by the right framework to measure results—specifically consistent business impact such as incremental revenue vs. other channels,” the report states.

Also of interest to radio broadcasters, Zenith expects Internet radio advertising to reach $1.36 billion this year, up from $1.19 billion in 2015, and hit $1.83 billion by 2018, while podcast advertising is beginning to get some momentum, reaching $35 million in 2016, compared to just $22 million in 2007, and reaching $38 million in two years.

The television advertising industry is faring slightly better in Zenith’s latest report, besting earlier projections. Thanks to increased spending by drug companies and a slight shift of ad dollars by consumer packaged goods from digital to TV—as well as a positive upfront season for TV networks—Zenith now expects overall U.S. TV advertising will grow 1% this year, compared to the -1.5% projected earlier, followed by flattish growth the next two years.

In 2017, television, long the bellwether medium in advertising sales, will collect a total $72.01 billion in ad revenue, or 35.8% of total media ad spending in the U.S., according to the latest forecast by eMarketer. 

Meanwhile, total digital ad spending in 2017 will equal $77.37 billion, or 38.4% of total ad spending. And digital’s growth doesn’t show any signs of slowing down. By 2020, total digital ad spending will rocket to $1.05 billion, while television will inch up to $77.17 million.  For its part, broadcast radio, which only includes over-the-air advertising and does not take into account its fast-growing off-air and digital revenues, is expected to account for 7% of all ad spending in 2017 and its share will drop to 6.1% by 2020.

Overall, eMarketer expects total U.S. advertising spending to increase 4.8% to $201.32 billion in 2017; Among digital media platforms, mobile’s share of ad spending will continue to rise steadily, growing from 10.9% in 2014 to 32.9% by 2020. Mobile advertising is expected to hit $52.76 million in 2017 and grow to $77.10 by 2020.

Digital video advertising is also on a hot streak, with projections to hit $11.72 million next year and burgeon to $16.69 million by 2020. And while TV’s share is slowly eroding, the medium is still a top buy for many advertisers. “We still expect positive growth for TV ad spend, driven by political advertising and the summer Olympics,” eMarketer senior forecasting analyst Martín Utreras said in a news release. “However, we see more ad dollars flowing to digital as a way of optimizing spending in what may be a challenging economic year.”

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That amounts to as much as $32 billion this month on new vehicles—nearly $3 billion more than February 2015.  According to MediaPost, February will break a new record, marking the first time that consumers have ever spent more than $30 billion on vehicles in the month of February.

And the news gets better for the industry: So far this month, leases and loans of 72 months or longer represent 65.1% of all retail sales, a record level for any month. J.D. Power says the previous record was set in January 2016 at 64.3%.  As a caveat, John Humphrey, senior VP of global automotive practice at J.D. Power, notes that “the year-over-year sales growth projection for February is strong, but we need to keep in mind that it is aided by the fact that sales in the upper East Coast, Midwest and Texas were hampered by weather last February.” So when February’s likely retail sales outcomes are extrapolated for the full year, the seasonally adjusted annualized rate of sales (SAAR) is still a solid 13.9 million units, vs. 12.8 million units last year.

J.D. Power says it is the strongest retail SAAR in the month of February since 2002.  Jeff Schuster, senior VP of forecasting at LMC Automotive, tells MediaPost that February’s auto results show that consumers are not intimidated by the recent stock market roller coaster or higher interest rates. “Very low fuel prices and many new vehicles in showrooms should help drive another strong year for auto sales,” he said.

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