Digital ad growth slows to single digits for first time

Digital growth is showing signs of slowing. Among the agencies measured by advertising intelligence firm Standard Media Index, digital ad spend grew 6 percent year over year in the first quarter of 2017. That’s the first time digital has seen just single-digit growth in a Q1 since SMI has been measuring it and compares to 19 percent growth in Q1 2016.

Social and video site spend continued to be bright spots in terms of ad spend growth. Social advertising was up 25.9 percent, and video site advertising was up 28.2 percent. The more mature search market grew just 3.1 percent year over year in Q1 2017.

Facebook spend shot up 33 percent in Q1. Still-upstart Snapchat saw ad spend increase by 287 percent year over year.

Spend on Google networks rose significantly less compared to those social networks — rising 11 percent year over year overall. With search seeing meager growth, video and display drove that growth rate. Ad spend on YouTube rose 25.8 percent, even as advertiser protests that began in mid- to late March over ads being shown on controversial content stood to threaten late-quarter contributions. YouTube accounted for roughly 19 percent of Google network spend in Q1. DoubleClick Ad Exchange saw a 60 percent increase in ad spend for the quarter.

Advertising across all media grew 2.8 percent year over year in the first quarter, the lowest Q1 rate since 2011.

SMI sources data from global media-buying agencies and says it captures 75 percent of agency spend.

About The Author

Ginny Marvin

As Third Door Media’s paid media reporter, Ginny Marvin writes about paid online marketing topics including paid search, paid social, display and retargeting for Search Engine Land and Marketing Land. With more than 15 years of marketing experience, Ginny has held both in-house and agency management positions. She provides search marketing and demand generation advice for ecommerce companies and can be found on Twitter as @ginnymarvin.