US online ad revenue $49.5 Billion in 2014

Digital advertising revenues in the US rose to an all-time high of $49.5 billion in 2014, according to the IAB Internet Advertising Revenue Report for the full-year, released today by the Interactive Advertising Bureau (IAB) and prepared by PwC US. This figure represents a 16 per cent increase over 2013’s record-setting total of $42.8 billion – and marks the fifth consecutive year of double-digit growth for the industry. The report additionally shows that 2014’s fourth quarter numbers reached $14.2 billion, a 17 per cent uptick from $12.1 billion in the final quarter of 2014.

Other highlights include:

• Mobile advertising in the US brought in $12.5 billion during FY 2014, a 76 per cent boost from the prior year total of $7.1 billion. As a result, it is the second largest format, accounting for 25 per cent of FY 2014 revenues, a rise over 2013, when it accounted for 17 per cent of that year’s total.
• Digital video, a component of display-related advertising, totalled $3.3 billion in full year 2014, a 17 per cent increase over revenues of $2.8 billion in 2013.
• Social media advertising saw stellar returns, bringing in $7 billion in 2014, up by 57 per cent over 2013’s total of $4.5 billion.
• Search revenues totalled $19 billion in 2014, up 3 percent from 2013, when search totalled $18.4 billion.
• Display-related advertising revenues in 2014 totaled $13.5 billion or 27 per cent of the year’s revenues, an uptick of 5 percent over $12.8 billion in 2013.
• Retail advertisers continue to represent the largest category of internet ad spending, responsible for 21 per cent in 2014, followed by financial services and closely trailed by automotive which account for 13 and 12 per cent of the year’s revenues respectively, and identical to their percentages in full year 2013.

“Marketers clearly recognise that consumers are leading mobile-first lives and are investing their ad dollars accordingly,” said Randall Rothenberg, President and CEO, IAB. “The news of digital video’s double-digit growth is also no surprise. Brands and agencies are clamouring to get into the upcoming Digital Content NewFronts, where they will experience the latest in storytelling in sight, sound and motion.”

“High double-digit growth in mobile advertising is a reflection of the continued shift in consumer behaviour away from desktop and towards mobile devices,” said David Silverman, Partner, PwC US. “A prominent rise in social, a significant mobile activity, is driving growth in advertising revenue as consumers spend more time connected.”

“Interactive marketing has generated remarkable revenue growth, a testament to its power to reach today’s consumers with innovative formats at critical junctures in the path to purchase,” added Sherrill Mane, Senior Vice President, Research, Analytics, and Measurement, IAB.