Furthermore, in some countries such as the UK, where it already accounts for almost 50% of total ad revenue, it will only keep getting stronger.
In 2016, online advertising will account for almost $160 billion, or 30% of global revenue. Print advertising sits in third with $101 billion, followed by radio with 8.4% of the market and $47 billion in revenue.
In the US, TV advertising revenue will make up roughly 38% of the country’s total, with online just behind on 36%.
In China, online advertising revenue will be 17% greater than TV advertising revenue, a difference of $15 billion.
The annual Global Advertising Trends report from IHS Technology’s Advertising Intelligence Service says that big brand budgets and quadrennial events such as the Olympics, European Football Championship and US Presidential Election will drive 2016’s global advertising revenue growth to $532 billion. This will represent an annual rate of growth of 7.1%, with the total for 2016 being equivalent to 0.69% of global GDP, up from 0.66% in 2015.
The top 10 markets will account for 75% of the global revenue figure. However, according to Eleni Marouli, principal analyst, IHS Technology, and the report author, “their collective power has dropped due slowdowns in the Chinese and Brazilian economies, which were the rising stars in the top 10 in 2015.”
Four out of the five fastest growing countries in 2016 were in Africa. “Ghana and Kenya have been high on the list of many media companies’ expansion plans, and we are seeing growth above 20%,” Marouli added. “These markets are still growing from a low base, but the sheer size of their populations means they are becoming interesting targets for big brands.”
The most mature markets are mostly high GDP per capita markets, says the report. Israel topped the list at $719 ad spend per person, followed by Switzerland and the US. China generated only $65 per person in advertising, despite being the second largest advertising market. Zimbabwe was the last on the list with $0.002 ad revenue per person per year.
Looking to 2017, Marouli said: “We expect global advertising revenue will grow to $590 billion in 2017.
“The strongest growth will come from the Middle East and Africa, followed by Asia Pacific, where India and Indonesia will steal the show.”
Developed markets are likely to slow down in an “event-light”, following the high spending for the Olympics and the US elections, the report said. While online will continue to be the fastest growing medium at 14%, a slowdown in the revenue growth of Google and Facebook is likely as the two are not attracting TV budgets to their online video offerings as fast as they had hoped.