July 10, 2014
United States Leads The Way In Total Ad Spending Per Capita
Peter Suciu for redOrbit.com - Your Universe Online
If it seems like it is impossible to escape ads, especially online and on mobile devices, there could be a reason. Advertisers spend a lot of money to reach eyeballs, and the United States leads the way in ad spending per capita globally.
According to new data from research firm eMarketer, digital ad spending will reach $140 billion in 2014, and mobile ads will account for $33 billion – or roughly 24 percent. Mobile led the growth in the digital ad market, and will be up by more than 85 percent over 2013.
The new report, which was released on Wednesday, noted that total ad spending in the United States will reach about $180 billion in 2014. The United States will account for nearly one-third of the total worldwide ad revenue of $545 billion, and the US ad spending remains the highest per capita globally. According to the research, advertisers spent roughly $565 per person in the United States.
Several factors are driving this year's growth in total media ad spending, which will see an increase of 5.7 percent – more than double the growth rate of 2.6 percent from a year ago. For one there is the worldwide advertising frenzy attached to the FIFA World Cup, as well as to a lesser degree the 2014 Winter Olympics. Additionally, eMarketer noted steady increases in online and mobile advertising, which follows the global consumer shift to digital devices.
While the United States still leads the way in what advertisers will spend to attract eyeballs, China is reportedly the second-largest ad spender in total and advertising there is expected to reach $49 billion this year – or roughly $37 per person. For per-capita spending Norway is poised to come in number two at $538.71 per person, followed by Australia ($504.36), Canada ($407.41) and Sweden ($393.07). The UK came in seventh with some $366.68 spent per person by advertisers.
India came in with the lowest per-capita numbers in the eMarketer study, which was found to spend a mere $5 per person on ads.
The United States is also expected to remain the top ad spender per capita through 2018 at least according to eMarketer, when the per-capita ad spending will reach $670.65 per person.
Mobile advertising is also expected to take a majority of the digital advertising market in mature markets such as the United States and the United Kingdom. By 2018 mobile will account for 70.4 percent of digital ad spending in the UK, with the US close behind at 67.8 percent.
By contrast, eMarketer noted that emerging markets including China, Indonesia and India will see mobile advertising actually remain just a comparatively small portion of the digital ad spending. What is also unique about this trend is that it is also in contrast with the common vision being "mobile-first," where consumers are much more likely to go online via a mobile device than they are via a computer. However, several factors reportedly contribute to this including a lag in mobile ad spending, which is based on the fact that many consumers in the emerging markets are still using feature phones or less advanced smartphones.
There is also the factor that even as the masses adopt mobile devices the per capita income remains low – India was noted in the study as being such an example – so that there is actually little to market to those individuals.
The study suggested that there remains a learning curve for mobile ad development and for this reason smartphone infrastructure for consumers does not immediately translate to functional advertising infrastructure. In these emerging markets TV remains the first choice for brands and advertisers.