Search ads in 1H generated $16.3 billion or 50 percent of total digital revenue

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Digital ad revenues in the US reached $32.7 billion for the first half of 2016, according to the IAB’s new Internet Advertising Revenue Report. Overall, search ad revenue (desktop + mobile) represented 50 percent of the total, which was up 19 percent year over year.

Mobile advertising as a channel (inclusive of multiple formats) was the single biggest growth driver, up 89 percent since last year, to $15.5 billion. The IAB announced that mobile “surpasse[d] Search as the lead ad format for the first time.”

Of course, mobile is not a format; it’s a collection of formats or a channel (display, social, video, search). Combined, search revenues were $16.3 billion, with the desktop contributing $8.9 billion of that total and mobile generating $7.4 billion.

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The numbers in the report are generated by sampling a subset of large advertisers, ad platforms/exchanges and publishers, including some public data, and extrapolating to the broader internet. The report points out that the majority of desktop advertising revenues are captured (74 percent) by the top 10 ad sellers and big publishers. In mobile, the wealth is even more concentrated in a smaller group of companies, two of which are named Google and Facebook.

In order, the top-spending advertiser categories in the first half were:

  1. Retail
  2. Financial Services
  3. Auto
  4. Telecom
  5. Leisure Travel
  6. Consumer Packaged Goods
  7. Consumer Electronics & Computers
  8. Pharma & Healthcare
  9. Media
  10. Entertainment

What the data in the report reflect is that nearly a decade after the introduction of the iPhone and several years after smartphone critical mass, brands and marketers are finally catching up to consumers.

You can read a more complete discussion of the IAB report at MarketingLand.

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Author: Greg Sterling

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