Despite disparity in forecasts, programmatic continues rapid growth

By Jim O'Neill on Jan 06 2017 at 6:00 AM
Despite disparity in forecasts, programmatic continues rapid growth

The global programmatic display ad market is expected to grow at a CAGR 49% by 2019, according to a new report from Future Market Insights.

The global programmatic display advertising market was valued at $7.6 billion in 2014.

Growth of the global programmatic display advertising market is primarily driven by improved return on investment for players across the value chain and improved addressability and targeting, which greatly increases sales and profitability of users.

But, another report, from Research and Markets, projects a lower, but still rapids pace for growth, of just over 18% between 2017 and 2021 for all programmatic sales.

R&M specifically says a major driver for this market is growth in video real time bidding.

The global video advertising market has moved from traditional TV to newer platforms such as online and mobile devices for video consumption. This has made it possible for brands to connect with their audience on a more personal level.

Last month, eMarketer reported programmatic ad spending in the U.S. alone grew more than 105% in 2016, with advertisers spending $6.18 billion for digital video ads purchased programmatically, up from $3 billion in 2015, a number that is expected to grow to more than $10.65 billion in 2018. Nearly two-thirds (60%) of all digital video ad spending this year was programmatic, compared with 39% last year and an expected 74% by 2018.

That triple digit growth in video ad spend – which the industry has seen since 2014 – is expected to moderate somewhat over the next two years, but still show a healthy 40% growth in 2017 and 23% growth in 2018 as the percentage of total digital video ad spend continues to swing toward programmatic.

Programmatic video advertising is an effective way to connect with consumers, and is a far more efficient way to reach consumers since the process is automated.

Since the advent of programmatic advertising, buying and selling of non-guaranteed online display advertising inventory is expected to reach near saturation in the near future, with over 50% of spending estimated to be transacted programmatically in 2015 across the globe. .

Meanwhile, the advertising industry is focused on automating guaranteed online display advertising as it is a popular mode of advertising, and attracts twice the spending as compared to non-guaranteed mode.

Stay tuned.

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