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MAGNA: Digital Advertising in U.S. to Reach $106BN in 2018

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Last week, Dentsu Aegis revised their 2018 ad market forecast. Now MAGNA is out with a revision of its own. Their updated forecast is very optimistic. MAGNA analysts expect media owners will realize a 6.4% increase in revenues, when compared to 2017. The global projection for the 2018 ad market comes in at $551 billion.

U.S. Ad Market

MAGNA analysts are also bullish about the U.S. ad market. They predict the revenue increase will match their global predictions: 6.4 percent. This figure includes cyclical activity related to advertising during the Olympic events and fall elections. These cyclical events will add an estimated $3.7 billion to U.S. media ad spending this year.

When that spending is excluded, the U.S. ad market is still expected to show a healthy growth rate of 4.7 percent. The driving force behind this increase is digital. Analysts note that, in the U.S., spending on digital advertising will amount to at least $106 billion. Keep in mind that total media ad spending in the U.S. will likely reach $206 billion this year.

Digital and Traditional

Digital media formats will likely grow (and shrink) as follows:

  • Paid social +31%
  • Video +24%
  • Search +14%
  • Traditional banner (-8%)
  • Online classifieds (15%)

On the non-digital ad front, out-of-home will shine with an anticipated 2% increase. Radio (-4%) and print (-17%) will continue to shrink.

National and local TV will grow only because of cyclical advertising. Analysts point out that the OTT premium TV market is a bright spot. Advertisers will spend about $2.2 billion this year to reach audiences that enjoy streaming programming on channels like Hulu. If your clients want to reach OTT TV Viewers, check out the AudienceSCAN profile available on AdMall from SalesFuel.

Verticals

MAGNA also reviews which verticals will be most active from an advertising standpoint. Look for automotive companies and movie producers to cut ad budgets. These industries are both enduring a sales decline. On the plus side, the technology and finance verticals have plenty of ad money to spend, much of it going to digital.

Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-owner of several small businesses in the health care services sector.

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