Internet advertising in SA hit R3.95bn in 2016
PwC and IAB South Africa has released the results of the 2016 Internet Advertising Revenue Report. Key outcomes from the annual report indicate total internet advertising, across all forms, devices and platforms, increased by 13% to R3.95bn.
Regardless of the downturn in the South African economy, the internet advertising market continued to show healthy growth of 13% (almost half a billion rand) in spend from 2015 to 2016, and continues to show exponential growth since 2013, when spend was only R1.3 billion, according to the report.
A number of trends within various segments of online advertising are emerging. Growth in online and mobile internet spend is underpinned by the shift to mobile internet advertising, with social media gaining most share, while paid search internet advertising is up significantly from 2015 by 19%.
There has been significant year-on-year movement in terms of industries increasing their stake in digital advertising spend. In 2016, the automotive industry, from not featuring in the top 4 of 2015, catapulted itself into the top spot as the biggest digital advertising spender in SA. Comments PwC: “As a result of economic uncertainty and consumers cutting costs, there was a substantial decline in new vehicle sales. To counteract this decline, the industry boosted advertising spend as they promoted discounts and special offers to incentivise sales.”
Retail emerged as the second largest spender (up from fourth in 2015), with Financial Services moving to third (from first in 2015) and FMCG coming in fourth (from second in 2015).
“This study confirms some things we already knew and others beyond what we anticipated. With return on marketing investment becoming more and more a measured deliverable against marketing spend, it is imperative that advertisers, media planners and buyers are well-versed in the trends now and anticipated in the future to deliver on these expectations,” says Gustav Goosen, head of IAB’s Research Council.
The report is compiled by PwC based on submissions received from SA advertisers (agencies/clients) and alternative media buying channels or platforms (the buy-side), as well as submissions received from local publishers and on-sellers (the sell-side).