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Programmatic advertising to grow 31% in 2017

Adspend

Programmatic advertising is expected to grow faster than all other digital mediums in 2017, becoming the principal method of trading digital display, according to media agency Zenith.

The group's Programmatic Marketing Forecasts report outlined findings from 41 key advertising markets and suggested that programmatic will grow 31% next year, outpacing social (up 25%) and online video (20%). It also predicted that a growing proportion of these other channels will be traded programmatically by the year’s end.

“Programmatic buying of digital media has become the norm in major markets, and is aggressively following this path in smaller markets,” said Benoit Cacheux, global head of digital and innovation at Zenith.

Such predictions are perhaps unsurprising in the current economy. Marketers The Drum has spoken to post-Brexit have outlined that in times of uncertainty they are investing more in channels where they can prove the efficacy.

“We believe that the growth of programmatic will continue to be fuelled by improvements in the quality of media available in programmatic environments – especially private market places – and the greater availability of programmatic mobile media, as well as the sophistication provided by ad tech solutions such as data management platforms and connected ad tech stacks.”

Programmatic advertising has risen to dominate the digital display market in just a few years, having accounted for just 13% of display adspend in 2012.

Advertisers spent $5bn in 2012 but that’s grown at an average rate of 71% a year to now stand at to $39bn in 2016.

Looking forward, spend will continue grow at an average 28% a year to 2018, when it will reach US$64bn.

The US is the biggest programmatic ad market by a long distance, worth $24.0bn in 2016 and accounting for 62% of total global programmatic adspend.

The UK comes second, worth $3.3bn, and China third, worth $2.6bn, but it’s the latter where major growth is predicted given that only 23% of digital media in the region is traded programmatically.

To find out more about the latest challenges and trends in the digital sector at The Drum’s second annual Programmatic Punch event, hosted in London on 8 December.

Leading industry names will duke it out over some of the key issues played out over the last 12 months, and will try to identify some of the potential pain points to come in 2017.

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Jennifer Faull

Jen Faull is deputy news editor at The Drum with a remit to cover the latest developments in the retail and FMCG sectors. Based in London, she has interviewed major business figures including top marketers from Mondelez, Unilever, Tesco, and Lidl.

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