The online advertising market in Australia will more than double in the next three years according to a report from research firm Frost & Sullivan.
The Australian Online General and Mobile Advertising Market 2014 predicts that online ad spending will increase from $1.15 billion to $2.42 billion by 2018.
The report said online video continues to be the fastest growing type of online general advertising inventory, with a growth rate of 60 per cent during 2013/14. It now accounts for 17 per cent of overall online advertising expenditure.
Frost & Sullivan Australia and New Zealand senior research manager, Phil Harpur, said “Sponsorships, integrated site content and in particular native advertising grew as online publishers increased their range of offerings. Also the affiliate online advertising market continues to grow strongly, especially in the online retail, finance and travel segments.”
Social media advertising is becoming more lucrative according to the report. Seventy-two per cent of organisations that advertised on social media channels in the previous year report a positive return on investment (ROI). This figure was up from 63 per cent in 2013.
“Strong growth is also predicted over the next five years for the Australian mobile advertising market, driven by strong growth in consumer media consumption on both smartphones and tablets, and better targeting capabilities by online publishers and mobile ad networks,” said Harpur.
The firm predicts mobile ad spending will reach $900 million by 2019. Tablets are predicted to account for over 70 per cent of overall mobile advertising spend in the period.
“There is growing demand for innovative ad units, which have higher consumer engagement and impact. Also native advertising solutions are very popular amongst online publishers,” Harpur added.