GroupM Internet advertising hit $84.8 billion in 2011, representing a 16 percent increase over the previous year and accounting for more than 17 percent of all global measured advertising expenditures, according to a new report from GroupM.
North America led the pack in terms of overall digital ad spending with an estimated $34.5 billion; Asia-Pacific came in second with $24.8 billion followed by Western Europe with $21 billion, according to the study, entitled This Year, Next Year: Interaction 2012.
The study is part of GroupM’s media and marketing forecasting series drawn from data supplied by parent company WPP’s worldwide resources in advertising, public relations, market research, and specialist communications. It was released today by London-based GroupM Futures Director Adam Smith and New York-based GroupM Interaction Global CEO Rob Norman.
The study also predicted that in 2012 digital advertising spending will reach $98.2 billion globally, almost 16 percent more than this year. The figure represents almost 19 percent of all measured advertising investment. In the 2012 forecast, North America once again ranks first with an estimated $38 billion in digital ad spend; Asia-Pacific follows with $31.4 billion followed by Western Europe with $23 billion.
In the US, digital advertising spending hit $32.2 billion in 2011, representing a 22 percent share of the overall domestic market and a 12 percent increase over the previous year, according to the study. This year those figures are expected to reach $35.4 billion for a 23 percent share and a 10 percent increase over 2011.
The report also includes detailed commentary on the current state of various digital marketing developments and offers insightful observations on the evolution of digital communications and the inherent implications for marketers.
“At the risk of an ‘oh really?’ response, it’s possible to argue that for the first time since these reports began that the last year has been one of evolution rather than revolution,” Norman wrote in the report’s introduction. “It seems that less is brand new and that a combination of scale of usage of an increasingly social and mobile Web, the penetration of devices supported by it, and the continued atomization of audiences and content, in both their creation and distribution combine to tell the story of the year.”
Norman added: “In 2007 we speculated about a world that would be truly social, searchable, mobile, addressable and interactive and illuminated by data that could be collected and applied across all marketing functions; in 2012 that is no longer a matter for conjecture.”
In addition to spending forecasts, the comprehensive, 20-country report also details ad investment in paid search and Internet display as well as providing data on broadband penetration, media time spent online and e-commerce per user data.
Additional key findings in the survey include the following:
Digital advertising’s share of total ad investment rose from 4.4 percent worldwide in 2004 to a projected 18.8 percent in 2012.
The average percentage of consumers’ “media time” spent online increased from 11 percent in 2006 to 19 percent in 2011. The absolute number of broadband homes worldwide has nearly tripled in this period to reach 500 million, and the typical country has seen broadband penetration grow by half.
Aside from general monetary inflation, ad investment growth has two main vectors: aggregate audience hours, and advertising intensity per individual. Average online advertising investment per online user doubled between 2006 and 2011. For 2011, Norway had the highest per-capita online ad investment in the study’s sample—$200.
E-commerce accounts for about 5 percent of global retail sales today, with instant-on devices, secure and simple payment, vouchering, and the optimization of retail for mobile serving as catalysts for growth.
Consumer tablet penetration reached double digits in only three of the survey’s countries in 2011: the US, Finland and South Korea. However, take-up is expected to be rapid and nine countries should reach double digit penetration in 2012.