Blog Post

Mobile and Social Eating Up More Online Advertising Revenue Pie

The Interactive Advertising Bureau, IAB, recently released their Internet advertising report that covered the first half of 2014, which we thought was important to share with you! Adam and Chad break down the findings to further educate advertisers and our SEO reseller community on what they should be mindful of when they’re making business decisions for the remainder of 2014. The report includes statistics on search, social media, mobile, and more. In this Daily Brown Bag, you’ll learn about 2014 Internet advertising revenues, how small businesses should spend their money, how 2014 Internet advertising revenues compare to 2013 Internet advertising revenues, and insights on mobile and social media.

Also available on YouTube.


Hello, and welcome to the Daily Brown Bag. Today we're going to be talking about Internet advertising revenues. I'm Chad Hill, and I'm joined by Adam Stetzer.

Good afternoon, Chad. Welcome to the Brown Bag.

Yeah, we're covering a report that just came out from the Interactive Advertising Bureau. They just released their Internet advertising report for the first half of 2014, and there's a lot of data in here that will help inform our SEO reseller community and advertisers at large.

I want to plow into this. There's a lot of stuff here. The big headlines are that we're seeing huge jumps for mobile and social media. I'm sure you're going to talk about that in the bottom half of this Brown Bag, but here are some of the numbers.

Internet advertising revenues hit an all-time high of $23.1 billion. That's a large number, $23 billion, up over 15% compared to the same period of last year. Total Internet advertising revenues are up a healthy 15%. We're on track to be the highest year yet, expected to hit $49 billion by the end of the year. There's no doubt that the Internet advertising space is definitely still growing at a healthy clip.

Mobile experienced a 76% increase in the first half of 2014 up to $5.3 billion compared with $3 billion in the first half of 2013. Advertising on social media platforms saw a 58% increase, not as high as mobile, but it's still a very large increase, 58% from the same period last year. We see another big jump, Chad, also in video, up 13% from the same period last year.

Last but not least, we're going to cover, of course, our good friend search, which did have an increase of 4%. It's moving up. It's at 9.1 billion versus 8.7 billion for the first half of 2013. So a lot of data here to digest on what's happening in the Internet advertising world. How do we help make sense of this for our SEO reseller viewers?

Well, I think a couple of things. One is that search is still the biggest part of the pie here. It's 39% of total advertising revenue, and I think that most of our small business viewers out there know because they're probably putting a large part of their budgets in search because it tends to get the most immediate and measurable return on investment. But what is really interesting here, Adam, is that the landscape continues to expand. The number of impressions is not stagnant. It's growing, and those impressions are growing on mobile devices and in social media networks.

We've covered a lot of news recently about things like Twitter getting smarter about advertising and about filtering your feed to make it more useful. We talked a lot about more and more people using mobile devices, and especially email mobile devices. I think these trends are very good for the small business. The big question is how do you spend your money wisely.

A couple of things to just kind of round this out. The top verticals that we're seeing are still fairly well known here. We've got retail at 21% of total advertising spend, financial services at 13% of revenues, and automotive at 12%.

The study also showed that 71% of total online advertising revenue is concentrated among the top ten advertising companies. We just covered this last week about this Google-Amazon competition and the fact that Amazon is the largest advertiser on Google. They're competing head to head. Really, the advertising spend here is fairly concentrated, but at the same time we know that long tail, all those small businesses out there advertising, there are more and more opportunities.

I'm excited personally about this, because I think the more new things out there it gives us opportunities to find unique ways to reach our clients' audiences. The reality is that search has gotten pretty expensive, and a lot of businesses are questioning it, so these new platforms I'm looking forward to seeing what we can do to help small business take advantage of them.

Yeah, I agree. I'm excited, too. I think diversification of ways to get to market and healthy competition are probably a good thing for the industry.

That's our coverage today of the Internet Advertising Bureau's Internet advertising report. These numbers, at least, so far into 2014 and projections for the end of the year, are showing the big winners are mobile and social media.

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