Australian digital ad revenues hit $2.1bn buoyed by mobile and video

Mobile and video ad spends boost digital ad revenues past $2bn in Australia

Digital advertising revenue in Australia reached $2.1bn in the first quarter of 2018, as mobile and video advertising continue to bolster spends.

The figures from the Online Advertising Expenditure Report by IAB/PwC revealed an overall increase in digital ad revenues – up 13% year-on-year, although this figure dipped 3.5% from the December quarter due to the increased Christmas spend.

Search and directories continue to attract the largest share of advertising dollars attracting 45% of spend worth $937m, followed by general display advertising at 36% ($767m) and classifieds at 19% ($397m).

Mobile advertising continues to drive the market, increasing 39% in Q1 2018, while video advertising grew 38% compared to Q1 2017. Display advertising increased 20.3%, classifieds grew 11.2% and search was up 8.8% year-on-year.

Video advertising now accounts for 42% of all display advertising, as the market shifts spend away from search and classifieds into display formats.

Gai Le Roy, IAB director of research, said this trend would continue, “Our market is chameleon-like, mirroring the significant shifts in consumer behaviour towards mobile and video, so it’s little surprise to see an increased investment in these formats.

"While it’s likely we will see a continued softening in some of the more established digital ad revenue streams, we fully expect mobile and video advertising continue to surge as marketers explore and challenge the possibilities of digital to build trust and reputation for their brands.”

Automotive advertisers continue to be the largest investors in display with 18.3% of share, while FMCG are the biggest investors in video advertising at 12.2% of spend, followed by finance (10.8%) and telecommunications (8.7%).

According to IAB data, the Australian market closely resembles the UK market where display advertising represents 35% of total ad spend, which is similar to Australia’s 36% and significantly lower than the US’ 50% share of ad spend. However, mobile advertising in Australia lags behind the UK where it accounts for 45% of all digital ad spend.

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