Social Media Ad Revenue to Reach $9.2 Billion by 2016
According to a report issued today from research firm BIA/Kelsey, U.S. social media advertising revenue is on track to reach $9.2 billion in 2016, up from $4.6 billion in 2012, representing a compound annual growth rate of 19.2 percent.
The bulk of that spending will involve social display advertising, which BIA/Kelsey expects to grow from $3 billion currently to $5.4 billion in 2016, representing a compound annual growth rate of 15.2 percent.
The local segment of U.S. social media advertising revenue will grow from $1.1 billion in 2012 to $3 billion in 2016, representing a 28 percent compound annual growth rate.
"The year 2012 can be viewed as social advertising's coming of age," said Jed Williams, program director of social local media at BIA/Kelsey, in a statement. "The continued development of native ads, such as Facebook's Sponsored Stories and Twitter's Promoted Tweets, and the acceleration of mobile monetization will be the primary drivers of social advertising growth through 2016."
To draw in more ad dollars, Twitter and Facebook have been ramping up their offerings. Spending on native social advertising, such as ads integrated into newsfeeds or content streams, is expected to grow from $1.5 billion in 2012 to $3.9 billion in 2016, according to BIA/Kelsey.
Earlier this year, Twitter rolled out targeted ads based on interests or hobbies that users share on their Twitter streams. Just in time for the holidays, Twitter also announced a promotion last week designed to bring at least 10,000 new small businesses into its advertising program.
As for Facebook, the giant social network has been increasingly adding Sponsored Stories to its 1 billion users' newsfeeds and recently announced plans to develop an external ad network that would allow the company to use its data about users' likes and dislikes to show people ads outside of Facebook.
The report also identifies mobile as a key growth area for social media. BIA/Kelsey estimates social-mobile ad revenue will increase from $500 million in 2012 to $1.5 billion in 2016, representing a compound annual growth rate of 28.5 percent. A variety of forces, including rapid social-mobile consumer usage growth, active experimentation by vendors, and deep integration of native ad units on the platform, will drive this growth, according to the research firm.
Adobe Upgrades Almost Every Aspect of Its Marketing Cloud
New enhancements add better campaign management, mobile and social capabilities, analytics insights, and content management.
Twitter Rolls Out Transparency Site
Transparency.twitter.com unleashes data about copyright notices, removal, and information requests.
PostRelease Joins Forces with Tapatalk to Help Publishers Monetize Mobile Sites
The advertising platform lets companies add native ads to content.
Social CRM and the Great Power Shift
Five keys to success.
Twitter Is an "Interest Network," Says Twitter Exec
Don't call it a social network.
To Be Social with Customers, Look Inside Your Organization
Proper engagement will require cross-enterprise change and strategy.
HootSuite Beefs Up Facebook Targeting Capabilities
New features let marketers target users by gender, age, relationship status, education, and more.
SumAll Adds Instagram Analytics
Tool helps companies visualize social, online sales metrics.
Telnames Rolls Out Mobile Site Building App
New app lets SMBs create mobile-friendly sites in minutes.
SocialMotus Launches Social Media Management Tool for SMBs
The new application features in-depth team management and analytics.