IAB internet advertising revenue report, conducted with PricewaterhouseCoopers, is considered to be the main and the most accurate source for online advertising.

Below you’ll find a quick summary and a few interesting highlights from this report. For the full report, follow the link at the bottom (direct link to 32-page PDF, no need to register).

Executive Summary

Digital revenues for full year 2018 surpassed $100 billion for the first time.

Internet advertising revenues in the United States totaled $107.5 billion for the full year (“FY”) of 2018, with Q4 2018 accounting for approximately $31.4 billion and Q3 2018 accounting for approximately $26.6 billion. Revenues for FY 2018 increased 21.8% over FY 2017.

Quarter over quarter digital revenues increase 18.1% for Q4 2018.

Advertising revenues delivered on mobile devices totaled $69.9 billion in FY 2018, a 39.7% increase from the prior FY 2017 revenues of $50.1 billion.

Advertising delivered on a mobile device now makes up 65.1% of total internet advertising revenues.

Advertising revenues from digital video totaled $16.3 billion for FY 2018, up 37% from the prior year. Revenues from digital video now make up more than 15% of total revenues.

Highlights

2018 revenues show continuing strong growth

Revenues for FY 2018 totaled $107.5 billion, $19.2 billion (21.8%) higher than in FY 2017

Key growth drivers

• The battle for market supremacy (between the digital ad giants and also between the smaller and bigger players)
• The resurgence of eCommerce (in part due to increased effectiveness to reach the target market)
• Storytelling catches fire (especially on social media, in video format)
• Programmatic advertising (currently at 80% of all digital display advertising revenues)
• Innovation of new ad technology (more data available, AI, better cost efficiency)

Desktop vs. mobile

Advertising revenues from mobile devices continue to grow faster than the overall market, with mobile increasing its revenue share to 65.1% in 2018.

Historical trends (desktop vs. mobile)

Mobile ad revenues represented 65.1% of total FY 2018 revenues, as compared to 56.7% of total revenues reported in FY 2017 and 50.6% in FY 2016.

Revenue concentration

Top 10 companies account for three-quarters of total ad revenues in Q4 2018

75% of internet advertising revenues in Q4 2018 remain concentrated with the top 10 leading ad-selling companies. This is 3% higher from the percentage reported in Q4 2017 (72%). Companies ranked 11th to 25th accounted for 7% of revenues in Q4 2018, a one percentage point decrease from the 8% reported in Q4 2017.

The concentration of top 10 revenues has fluctuated between 69% and 77% over the past ten years.

Advertising format revenue

Digital video advertising revenue showed the largest growth among formats in the full year 2018 report.

Historical advertising market share by media

Internet advertising is the only media type that has experienced double digit growth year-over-year.

Besides internet advertising, the year-over-year growth rate for all media types is in the single digits. Internet advertising has sustained its growth in part by the mainstream emergence of existing digital formats.

Conclusion

In terms of advertising overall, digital is not just the largest but also the fastest-growing.

In terms of digital, mobile and video see huge gains in popularity.

Worryingly, the power is more and more concentrated in the hands of the giants: mainly Facebook and Google. Other participants are left with a smaller market pie and need to innovate to stay relevant and to have any chance to grow.

For more details, data and explanations, see the full report.

IAB internet advertising revenue report 2018 full year results

PS. If you had to choose one format and media to concentrate on, go with video on mobile. Ideally, focus on good storytelling and you should be fine.