The Covid-19 pandemic resulted in people staying at home and/or working remotely from home, resulting in huge increase in online traffic. The large increases in online traffic provide opportunities for companies to keep their target audience engaged through digital marketing initiatives. While overall digital marketing spending declined due the pandemic-induced cuts in marketing and advertising budgets during the lockdown , available budgets are being directed at digital marketing initiatives. In addition, advertisers are realizing higher returns on their investments owing to lower competition for advertising space. As a result, the pandemic is driving changes to digital marketing strategies at companies, especially at companies where digital marketing initiatives had relatively low priority.
Clicks and display ads are among the most prominent forms of digital marketing initiatives. Clicks are expensive compared to display ads, as clicks ensure the customer is directed to the advertiser’s website. However, clicks provide a better return on investment. The declines in digital marketing budgets across the spectrum resulted in lower costs per click. As a result, marketers are gaining more clicks for the same cost. Proactive advertisers with long-term outlook are utilizing the lower costs of clicks to improve their marketing plans and stand to gain the most when conditions improve. The continued spending on digital marketing initiatives would ensure that such advertisers have a high recall for their products or services when the conditions improve. In addition, the lower costs of digital marketing, as well as the unfavourable circumstances for other marketing and advertising formats is resulting in advertisers exploring and/or increasing their marketing spends on digital marketing.
Amid the COVID-19 crisis, the global market for Digital Advertising and Marketing estimated at US$476.9 Billion in the year 2022, is projected to reach a revised size of US$786.2 Billion by 2026, growing at a CAGR of 13.9% over the analysis period. Display, one of the segments analyzed in the report, is projected to grow at a 15.5% CAGR to reach US$521.5 Billion by the end of the analysis period. After a thorough analysis of the business implications of the pandemic and its induced economic crisis, growth in the Search segment is readjusted to a revised 12.2% CAGR for the next 7-year period. This segment currently accounts for a 40.9% share of the global Digital Advertising and Marketing market. Online display advertising is similar to advertising on billboards, print ads, and TV ads, and provides viewers with upfront information about the product or service being promoted. Research has revealed the positive impact of display ads on user behavior even at lower click-through rates owing to the ability of these ads to stay etched on the minds of a user for longer than ads triggered through search.
Leading portals including Google and MSN; as well as social media sites such as Facebook and Twitter make use of display ads, lending traction to the continued popularity of this format. The dominance of display advertising is set to continue its growth trajectory as the format adapts to the growing mobile advertising landscape. Furthermore, the introduction of native ads as a measure to tackle the growing practice of ad-blocking by users is also set to promote further growth in display ads. On the other hand, search advertising has proven successful for local businesses in particular, helping them gain a bigger stage in terms of visibility. With search being the most common starting point for consumers surfing the internet, search dominates the Internet advertising market.
The U.S. Market is Estimated at $179.4 Billion in 2022, While China is Forecast to Reach $254.9 Billion by 2026
The Digital Advertising and Marketing market in the U.S. is estimated at US$179.4 Billion in the year 2022. The country currently accounts for a 38.6% share in the global market. China, the world second largest economy, is forecast to reach an estimated market size of US$254.9 Billion in the year 2026 trailing a CAGR of 18.4% through the analysis period. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at 7.6% and 8.1% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 5.8% CAGR while Rest of European market (as defined in the study) will reach US$288.5 Billion by the close of the analysis period.
Developed regions including the US, Canada, Japan and Europe, constitute key revenue contributors for the global digital advertising and marketing market. Factors such as huge penetration of connected devices, highly developed digital ecosystem backed by large media companies and ICT services providers, and robust focus on digital media campaigns among businesses remain the prime contributors for growth and progress digital ad market in the developed countries.
Per capita spending on connected devices remains high in the developed regions, with a significant portion of consumers purchasing mid- to high-end devices for various purposes. Products with sophisticated features and functions are popular among consumers, and price of the product remains mostly irrelevant as majority of consumers are affluent. While consumer affluence and general inclination towards advanced technologies favour wider acceptance of connected devices, active participation of leading electronics manufacturers drives momentum in the market. As penetration of connected devices and consumer inclination towards digital solutions remains high, developed regions represent the primary markets for digital advertising and marketing, globally.
By Vertical, Retail & Consumer Goods Segment to Reach $158.3 Billion by 2026
Global Retail & Consumer Goods (vertical) segment is estimated at US$103.1 Billion in 2022, and is projected to reach US$158.3 Billion by 2026 reflecting a compounded annual growth rate of 11.9% over the analysis period. China constitutes the largest regional market for Retail & Consumer Goods segment, accounting for 36.1% of the global sales. China is poised to register the fastest compounded annual growth rate of 15.3% over the analysis period, to reach US$76.7 Billion by the end of the analysis period.
This article was originally found here: Digital Advertising & Marketing Market to Reach $786.2 Bn by 2026 | MarTech Cube
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