Global digital advertising to reach USD1 trillion by 2026
By Abimbola Mohammed
Digital marketing continues to grow at a speed of light that even in 2021 alone the growth in digital advertising value grew to nearly $486.0 billion. Since then it has grown at a compound annual growth rate (CAGR) of 18.5% since 2016.
According to a recent report by Research and Markets on “Digital Advertising Global Market Opportunities and Strategies To 2031”, digital advertising growth will continue at a strong pace.
While the fastest-growing regions in the digital advertising market will be Africa and the Middle East where growth will be at CAGRs of 18.6% and 17.2% respectively, R&M forecast the market to grow from $486.0 billion in 2021 to $980.2 billion in 2026 at a rate of 15.1%. The market is then expected to grow at a CAGR of 12.8% from 2026 and reach $1.79 trillion in 2031.
“Growth in the historic period resulted from the strong economic growth in emerging markets, increased internet penetration, government initiatives in developing economies, rising penetration of e-commerce, increased availability of mobile devices, rapid development in technology, an increase in social media usage and the impact of COVID-19,” Research and Markets said.
Going forward, increasing advertising expenditure by end-use industries, rising urbanization, and increasing adoption of 5G networks and the Internet of Things (IoT) will drive market growth.
While giving this report, R&M further stated the factors that could hinder the growth of the digital advertising market in the future as stringent regulations, intense competition, security challenges and data localization.
Analysis
Going forward, the digital TV segment is expected to be the fastest growing segment in the digital advertising market segmented by platform, at a CAGR of 15.3% during 2021-2026.
The desktop ad market was the largest segment of the digital advertising market segmented by platform, accounting for 43.4% of the total in 2021.
The digital advertising market is also segmented by ad format into digital display ad, internet paid search, social media, online video and other ad formats. The internet paid search market was the largest segment of the digital advertising market segmented by ad format, accounting for 30.5% of the total in 2021.
Moving forward, the fastest-growing regions in the digital advertising market will be Africa and the Middle East, where growth will be at CAGRs of 18.6% and 17.2% respectively. These will be followed by South America and Asia-Pacific, where the markets are expected to grow at CAGRs of 17.1% and 15.2% respectively, according to Research and Markets.
Also the online video segment is expected to be the fastest growing segment in the digital advertising market segmented by ad format, at a CAGR of 20.5% during 2021-2026.
The digital advertising market is also segmented by industrial vertical into media and entertainment, consumer goods & retail industry, banking, financial service & insurance, telecommunication IT sector, travel industry, healthcare sector, manufacturing & supply chain, transportation and logistics, energy, power, and utilities and other industrial sectors.
The banking, financial service & insurance market was the largest segment of the digital advertising market segmented by industrial vertical, accounting for 23.6% of the total in 2021. Going forward, the media and entertainment segment is expected to be the fastest growing segment in the digital advertising market segmented by industrial vertical, at a CAGR of 18.3% during 2021-2026.
North America was the largest region in the digital advertising market, accounting for 43.4% of the total in 2021. It was followed by Asia-Pacific and Western Europe.
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