Social media ad spend is set to hit parity with newspapers as early as 2020 according to research by Zenith, reflecting the sharply contrasting fortunes of both sectors.
Zenith’s market research analysts predict that global ad spend on social will reach 20% of all internet advertising in 2019, valued at $50bn – just 1% below the equivalent figure for newspaper ads. By 2020 the two will be on an equal level, they predict.
Over the last ten years internet advertising has risen from 7% of total global spend (in 2006) to 34% (in 2016). Meanwhile newspapers’ share of global spend has fallen from 28% to 11%, while magazines’ has fallen from 13% to 6%.
“Print titles will continue to lose market share as their readers continue to move to online versions of the print brands or other forms of information and entertainment entirely,” the report reads.
Such declines explain why newspapers are starting to rethink their business models and diversify revenue streams outside of print advertising, as evidenced by News UK’s bid to reach its most prominent audience segments by building out verticals such as a betting and gaming division, radio play and magazine supplement range.
While Zenith predicts newspapers and magazines will continue to shrink at average rates of 5% and 4% a year respectively between 2016 and 2019, ending with respective 8% and 5% market shares, internet adspend is forecasted to attract 41.4% of all global advertising by 2019.
This means overtaking TV as the world’s largest advertising medium in 2017. TV’s share of the ad pie is said to have peaked at 39.4% in 2012, estimated at 35.6% in 2016, and by 2019 it is expected to fall back to 32.7%, its lowest share since 1990.
The changing advertising landscape is reflected in the way brands are shifting their money from traditional mediums to emerging platforms like Snapchat. Significant print spenders such as Tesco, L’Oreal and Sky have already shifted big chunks of their plans online while other brands are taking innovative approaches to social media, as evidenced by Adidas’ micro-influencer bid, and Coca-Cola centralising its social media marketing.