More Than Half of Digital Advertising Is Mobile – Wall Street Journal (subscription)

Last year was officially the much-awaited “year of mobile” in the advertising industry.

For the first time, mobile advertising represented more than half of the spending that marketers funneled into digital advertising overall in the U.S. in 2016. According to a new report conducted by PwC US for the Interactive Advertising Bureau, mobile ad spending accounted for 51% of the record $72.5 billion in total U.S. digital ad spending last year.

In fact, spending on mobile advertising surged 77% to $36.6 billion last year, according to the IAB. Digital ad spending broadly climbed a healthy 22% in the U.S. from the prior year.

“Brand dollars naturally follow consumers, and you’re starting to see a mobile-first, and sometimes a mobile-only mind-set among marketers,” said

David Doty,

the IAB’s executive vice president and chief marketing officer. Mobile “dominated” the more recent growth in the industry, he added.

A big chunk of that mobile growth was driven by

Facebook

and Google, the web’s two most powerful ad platforms, each of which has exhibited exponential growth in mobile ads. But the IAB says that mobile ad success was also achieved across the board.

Mr. Doty wouldn’t comment on how much of the spending growth was driven by Google and Facebook, but played down recent industry talk that only those two companies alone are benefiting from this surge.

“We are seeing major increases across the spectrum,” he said. “It’s not universal. There tends to be dominant players [in any medium]. But it’s not the case here that the growth is only theirs. There are upticks that go well beyond [those two companies].”

In fact, PwC US partner David Silverman said 73% of the revenue tracked by the IAB in the fourth quarter went to the top 10 companies tracked, with 69% of the overall ad revenue growth concentrated among those firms.

“That means 31% of the growth came from outside the top 10,” Mr. Silverman said.

Web video advertising also enjoyed robust growth in 2016, with spending jumping 53% to $9.1 billion. Mobile video spending, in particular, ballooned by 145% year-over-year to nearly $4.2 billion, says the IAB.

Interestingly, for the first time, digital audio advertising crossed the billion-dollar revenue mark, landing at $1.1 billion. That number includes ad revenue generated by streaming services and podcasting, Mr. Doty said.

Write to Mike Shields at mike.shields@wsj.com

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