Digital spend goes largely to direct response formats
Advertisers in six major industry categories are expected to increase digital spending more rapidly than the overall US digital ad market this year, eMarketer estimates in a series of new figures.
Four of the six industries growing their digital ad spending at or above overall market rates are retail, financial services, consumer packaged goods (CPG) and travel—the result of increased focus on direct response advertising, as well as branding, through digital channels.
In the US digital ad market, the retail sector makes up the greatest amount of spending of any single industry. eMarketer estimates that this year, 22.3% of all US digital ad spending will come from retailers, a percentage that has held steady over several years.
Though growth rates for retail digital ad spending are falling, with a 14% increase expected this year, the industry will hold on to a steady share of total spending throughout the forecast period. Nearly two-thirds of this retail spending will focus on direct response formats, such as search, mobile messaging, classifieds and directories, or lead generation.
The financial services industry will see similar levels of growth, though from a smaller base. Digital ads placed by financial services firms in the US will account for 12.4% of total digital ad spending this year, a share that will also hold steady throughout the forecast period. Financial services spending is similarly focused on direct response formats, with 62% of spending going to search, mobile messaging and the like.
The CPG industry, along with sellers of other consumer products, have grown their digital spending at a somewhat faster rate than the retail or financial services industries, though they remain relative laggards in terms of online spend. Just 8.3% of total digital spending this year will come from CPG firms. Unlike retail and direct response marketers, CPG advertisers are focused on branding efforts: 62% of digital spending will go toward banner ads, rich media, sponsorships and video, eMarketer estimates.
When examining travel industry ad spending, the familiar pattern of using digital ads primarily for direct response purposes is evident again. With travel spending levels just shy of CPG’s total this year, travel advertisers will devote nearly three-quarters of spend to direct response formats.