Digital Ads Top TV, Up 11% To Nearly $42 Billion

• by Wayne Friedman, June 1, 2015, 4:54 PM 

Pure-play digital advertising platforms’ growth rate continues to surpass both broadcast TV and cable TV gains.

 

Digital advertising sales -- excluding those online revenues going to television broadcasters, newspapers and magazines -- will rise 11% this year to $41.8 billion from $37.5 billion over a year ago, according to Washington, DC-based business advisory firm FTI Consulting.

By comparison, broadcast TV advertising revenue -- including online revenues that are owned by traditional TV owners -- will rise just 1% to $38.9 billion. Cable TV advertising revenue -- traditional and online -- will gain 6% to $33.4 billion.

 

Overall, TV will total $72.3 billion in 2015, up 3% from 2014.

By 2018, digital advertising revenues will continue to rise at a faster pace than TV, gaining 33% to $55.6 billion. Broadcast TV will grow 17% to $45.5 billion, while cable will climb by 20% to $40 billion.

 

In 2016, digital advertising will top direct mail -- getting to $47.0 billion, to direct mail’s $44.2 billion. This year it will top broadcast TV.

 

FTI also estimates that all newspapers' advertising revenue -- traditional and online -- will sink to $18.7 billion this year (from $19.8 billion in 2014). All radio will slip to $16 billion from $16.1 billion; magazines will drop to $12.8 billion from $13.2 billion; and Yellow Pages will fall to $3.9 billion from $4.4 billion.

 

In addition to the increase of digital, broadcast TV, cable TV, and direct mail this year versus a year ago, outdoor will also see a modest hike -- to $7.6 billion from $7.2 billion in 2014.

Concerning digital advertising’s growth, Philip Schuman, senior managing director/co-leader of FTI Consulting’s Media& Entertainment team, stated: “We believe that effective data-driven targeting, low CPMs and vast inventory, as well as a direct feedback loop that enables advertisers to calculate a return on digital advertising dollars spent, has enabled them to allocate less to get more.”

Research results come from regression analysis, including data sources from MagnaGlobal, Newspaper Association of America, Direct Marketing Association and Winterbury Group, and Internet Ad Bureau among others.