First published in Video Ad News, our chief economist Daniel Knapp broke down the key trends and changes taking place in video advertising across Europe.

6 August 2019, Video Advertising Grows Three Times Faster Than Display in Europe

The overall takeaway from this year’s report, which covers market trends in 2018, is that Europe’s digital advertising industry – aggregate – has continued to grow rapidly. Last year, gross digital advertising expenditure in Europe totalled €55.1 billion, up 13.9 percent from €48.4 billion in 2017. This represents a slight acceleration in growth on recent years and is the highest growth rate since 2011.

Growth in the video display market

For video advertising expenditure, including in-stream, out-stream and in-feed advertising, the acceleration in growth from 2017 to 2018 was even more pronounced than in the market as a whole, and increased its share of the total display market from 12.1 percent to 13.9 percent.

The total display market, helped by video, gained 1.3 percentage points of share. In fact, display growth was concentrated on video in 2018, with the format seeing growth of 30.9 percent, nearly three times faster than the rest of the display category.

Thanks to this growth, video now accounts for one third (32.8 percent) of total display expenditure across Europe. This is in keeping with the trend of the past five years, whereby video has been the main growth driver for the display market. Attracting brand budgets, with limited inventory available, video has historically been a sellers’ market with stable and high CPMs. Further drivers for growth include a wide array of factors from consumers accessing more content on mobile devices to an increase in inventory –  particularly from social platforms – to programmatically traded video, and a growing influx of brand advertising spend.

Local market trends

When it comes to which nations are driving digital video advertising spend, Western European countries dominate, led by the UK, France, Italy and Germany. Russia is the only non-Western European country to make the top five. However, with a few exceptions, Eastern European nations generally have much faster growth rates than those in the West.

In terms of digital video’s share of display ad spend by market (an indicator of the maturity of video advertising in each country) some Central and Eastern European markets are outperforming their West European peers. For example, at 41.6 percent, Ukraine’s video market appears to be more mature than all other European markets with the exception of the UK (43.9 percent).

In-stream vs. out-stream: a changing dynamic

Over recent years, the structure of the European digital video advertising market has been changing. Once dominated by in-stream video – be it broadcaster video, YouTube, or pre- mid and post-rolls against editorial content – the scarcity of inventory, paired with advertiser demand and the requirement for publishers to increase digital monetisation has rebalanced the market in favour of out-stream (incl. in-feed) video. In fact, out-stream is now nearly on par with in-stream with 49.4 percent market share vs. 50.6 percent.

As social platforms heavily ramped up their video play, in-feed as a subset of out-stream video is a key market driver. Out-stream grew 2.3 times faster than in-stream in 2018.

Where next?

We expect the video category to continue to expand, blurring traditional boundaries to TV advertising. Connected TV will no doubt grow in importance – but it is worth noting that while connected TV is exploding in the US, the market is much more fragmented and localised in Europe. However, standards like HbbTV offer a path for scaled growth, and local market initiatives to drive standards, measurements and technology will help bring the worlds of video and TV further together.

First published in MARTECHSERIES, the Marketing Technologist Insights publication, IAB Europe share some commentary about the growth figures released in 2018 and cast predictions and rationale for 2019 stats.

31 July 2019, The European Digital Advertising Market Continues on Its Growth Trajectory

This July, IAB Europe published the latest edition of its AdEx Benchmark report, which provides facts and figures about the health of the region’s Digital Advertising market in 2018. Since 2008, the study has mapped a trend of sustained double-digit growth. However, as 2018 got underway it was far from certain this trend would continue.

Indeed, for the first half of the year, the market showed all the signs of a slowdown. At that point, based on local market signals, we were forecasting that total growth for the year would be 12% on an annual basis – somewhat lower than had been achieved in 2017. This dip in activity in part relates to the introduction of the EU’s General Data Protection Regulation (GDPR), which came into force on the 15th of May. Uncertainty over how GDPR would play out meant that media buyers temporarily put the budget on hold while they took stock of the situation.

The market bounces back

This period of uncertainty is unsurprising and as you would expect in the context of such a game-changing regulation. What was unexpected, however, is just how quickly the market rebounded. The final figures for 2018 show that the Digital Advertising industry in Europe grew by 13.9% – the fastest growth rate the sector has experienced since 2011. Significantly, growth is reflected across all European markets; suggesting that Europe represents a common advertising market fuelled by similar growth drivers.

In financial terms, the European advertising market grew from €48.4 billion in 2017 to €55.1 billion last year. This increase suggests continued demand for Digital Advertising and at least partial adaptation to regulatory challenges. However, we expect that the full impact of GDPR won’t be realized until this year or next.

Overall, despite fundamental structural changes in the market over the past years, growth has been consistent since 2011 – varying only by a maximum of 2.4 percentage points. The growth drivers were the ‘usual suspects’: video, mobile, social, and programmatic. However, while in 2017 the market was flat once social was factored out, growth excluding social picked up in 2018. This suggests that amidst flat and declining parts of the industry, there are new pockets of growth.

A more diverse future

We expect growth to remain double-digit in 2019, but to slow down slightly to approximately 11% year-on-year. Sources of growth are diversifying as digital out-of-home becomes connected to the programmatic ecosystem and audio achieves scale through standardization, partnerships and an explosion in monetizable inventory. However, this growth is coming from a low base. It will take another five years before it can make a significant contribution to the overall spend.

In programmatic, a renewed focus on private marketplaces by media buyers highlights a growing realization that audience-based buying still needs context. This presents an opportunity for premium editorial environments. We also see a new generation of programmatic services built on top of the available infrastructure. Services like supply path optimization (SPO) provide new tools to spot inefficiencies and optimize the supply path, and dynamic creative solutions will deliver new use cases for a programmatic infrastructure.

Blurring boundaries between AdTech and MarTech enable new ways of activating companies’ customer base and first-party data. Today, organizations are increasingly looking to embrace metrics and KPIs that are outcome-oriented, and they increasingly want to move beyond proxy metrics for campaign success and measure media investment as close to business metrics as possible. The marriage of AdTech and MarTech provides a path for this.

At the same time, a new sense of ‘data realism’ is developing among some of the savviest brands. These organizations understand that data can’t solve everything and not all that can be measured and quantified matters. These brands eschew short-term metrics and the performance notion of advertising in favor of creative or design-led approaches. For some, this entails moving emphasis from paid media to experience design, such as app development, customer care, logistics, and other consumer-centric features.

Connected TV also has potential, and it continues to be a hot topic. However, the landscape is much more localized and fragmented in Europe than in the US, where a lot of the growth narrative comes from. More standardization and collaboration between market participants is required if it is to live up to its full promise.

First published for PerformanceIN, The AdEx Benchmark report author, Dr Daniel Knapp, chief economist at IAB Europe shares a broad market overview of the study's key findings with a detailed focus on the search results, across mobile and desktop.

29 July 2019, The European Paid-For Search Market: Stable Growth, but Structural Transformation Ahead

The AdEx Benchmark report author, Dr Daniel Knapp, chief economist at IAB Europe shares a broad market overview of the study's key findings with a detailed focus on the search results, across mobile and desktop.

Every year, the IAB Europe, a European-level industry association for the digital advertising and marketing ecosystem, publishes its AdEx Benchmark report. The report outlines the performance of the European digital advertising market and breaks down growth figures by both format and region. This July, IAB Europe released the latest edition of the study, which covers performance over 2018.

Looking first at Europe’s overall digital advertising sector, the story that emerges from the report is one of sustained growth. By the end of 2018, the total market had grown to €55.1 billion from €48.4 billion in 2017, an increase of 13.9% and the fastest the market has grown since 2011. From 2012 to 2018 the market has more than doubled in size driven largely by increasing advertising investments in social, mobile and video formats. Overall, since the first AdEx Benchmark study in 2006, the market added some €48.5 billion in annual value.

Figure 2: total digital ad spend growth

Paid-for search shows economic resilience

For some years now, paid-for search has been an important growth driver. In 2009, for example, it was the only medium in Europe not to fall into decline as a result of the recession, largely due to its ability to measure and pay by performance.

This resilience has been highlighted by ten years of like for like growth figures in the category. Indeed, of all the advertising formats that IAB Europe tracks in its AdEx Benchmark study, paid-for search has maintained the strongest growth rates in periods of economic uncertainty. Where other marketing spend gets cut when times are tough, the pay-by-performance model allows marketers stricter budget controls, and low entry costs enable tactical marketing interventions.

Growth is unevenly distributed

In 2018, despite the maturity of the format, growth in paid-for search continued in double-digit figures (12.5%) enabling it to maintain its total share of the European digital advertising market at 45%.

However, this growth was not spread evenly across Europe. At the top end, the paid-for search market in Belarus grew by 37.5% while at the bottom end, Belgium’s market grew by 1.9%. The top six markets in terms of growth are located in Central and Eastern Europe, while Finland (20.7%), Ireland (16.7%) Norway (15.9%) and Sweden (14.5%) are among the fastest-growing search markets in Western Europe.

Nordic markets have a strong local history of directories spend, which delayed the proliferation of the paid-for search market in the mid and late 2000s. The higher growth rates in the region are due to those historical reasons. The UK is the largest paid-for search market in Europe and still grew above the European average (14.3%).

Figure 33: paid-for search growth in 2018

The contribution of mobile search

One of the reasons that the paid-for search market is seeing strong growth is because prices for mobile search are beginning to catch up with desktop search prices. While the share of mobile searches is still roughly 10% higher than the share of mobile ad spend, the gap is shrinking. What’s more, mobile search has benefitted from an increase in mobile search volumes overall, helped by better integration with maps and changing consumer habits.

Figure 35: mobile search ad spend and growth

As a result, in 2018 mobile search grew by 28.6% to €11.6 billion and increased its share of the total search market by 5.8 percentage points. Once again, the growth leaders are Central and Eastern European nations such as the Czech Republic (70.6%), Belarus (54.4%), Ukraine (44%) and Slovenia (43.8%). Norway (35%) is the fastest-growing Western European market. The UK, which is by far the largest mobile search market (worth €4,646 million compared to the €1,313 million generated by Germany, the second-largest market) is growing in line with the European average.

Additionally, eight markets can now be considered mobile-first, in that their mobile share of search exceeds 50%. Five markets have a mobile share larger than 60%: Serbia, Ukraine, Russia, Turkey and Ireland.

Figure 37: mobile share of paid-for ad spend by market in 2018

Outlook: the changing nature of search

The nature of search itself is transforming. One of the biggest changes is the rise of Amazon, which is becoming a default destination for product-related searches. Mobile, and in particular app-based media consumption, are leading to a further verticalisation of the search market. Verticalisation means that consumers conduct search in specific functional apps - such as travel or entertainment - not all of which is paid for. At the same time, new opportunities to monetise mobile search arise, in particular through maps and in-car integrations.

Often, voice is highlighted as the next generation of search. Yet there still is a lack of systematic evidence that consumers are adopting voice to conduct diverse, and more complex search queries beyond daily, habitual tasks (checking the weather, for example). Monetising voice search also remains a challenge, both from a product and a privacy perspective.

In sum, these observations suggest that the future of search is defined by a more diverse set of factors than before. This will change how we define, buy and use paid-for search.

First published in Mobile Marketing Magazine, The AdEx Benchmark report author, Dr Daniel Knapp, chief economist at IAB Europe provides insight into the state of the European mobile advertising market on the back of the report.

25 July, 2019, Mobile continues to drive growth in European digital advertising

This July, IAB Europe published the latest edition of its annual AdEx Benchmark report on the state of the European digital advertising market. The report, which focuses on market performance over 2018, brings together facts and figures from across Europe relating to growth, and delivers a breakdown of spend across digital advertising formats.

The top-line figures for the overall market show that the entire European digital advertising sector grew by 13.9 per cent in 2018, which represents the fastest growth in the sector since 2011. Digital remains a significant driver for growth in the overall paid-media advertising market and now accounts for 45 per cent of the total. Between inception of the AdEx Benchmark study in 2006 and this year’s index, the market added €48.5bn in annual value.

Mobile increases market share of display
Where does mobile advertising fit into this picture? Mobile advertising first made a truly significant impact on the digital advertising market back in 2013, when it accounted for a double-digit share of digital spend for the first time. By 2017, mobile was one of the key drivers behind growth in display spend.

In 2018, mobile continued to drive growth. Overall, mobile display advertising spend grew by 34.2% to reach €11.4bn. This growth means that mobile accounted for 48.9 per cent of total spend in display advertising.

The strong performance of mobile display is in contrast to desktop display, whose share dropped to 51.1 per cent in 2018 from 57.2 per cent in 2017.

The growth of mobile display is largely due to the continued proliferation of social media and improved targeting options. The growth in optimised mobile pages from publishers has also played a part, as has the use of ad campaigns to drive app installs. Gaming apps were a particularly strong driver for growth in mobile display and we saw large gains recorded by app developers in this space.

Looking at the regional breakdown, the growth leaders are mostly emerging markets such as the Czech Republic (105 per cent) and Ukraine (65 per cent). However, Germany also demonstrated a surge in mobile display growth, coming second in the rankings at 65.4 per cent. Overall, mobile display spend is dominated by Western European countries, particularly the UK, which accounts for €4,759m of the total (almost four times as much as the second biggest spender, Italy, which accounted for €1,051m). Of note is the fact that 13 markets are now mobile-first (i.e. the share of spend on mobile exceeds that of desktop).

Mobile search spend trends upwards
Mobile also performed well in the search space, growing 28.6 per cent in the year to total €11.6bn. This represents an increase of market share of 5.8 per cent on 2017 (40.5 per cent vs. 46.3 per cent), bringing it closer to spend on desktop search. While this is a lower share of the market than in mobile display, it accounts for €0.2bn more in actual spend due to the larger size of the market.

Higher ad rates were a driver of growth in this market. This is significant because historically rates for mobile search have lagged those for desktop. And while the share of mobile spend still trails the share of mobile searches by around 10 per cent, the gap is closing. Mobile search also benefited from higher mobile search volumes overall, helped by better integration with maps and changing consumer habits.

In this category, nine of the ten largest markets are in Western Europe (with the exception of Russia, which ranks fourth). The fastest-growing markets are once again in Eastern Europe, with the Czech Republic (70.6 per cent), Belarus (54.4 per cent) and Ukraine (44 per cent) leading the pack. Eight markets are now mobile-first (i.e. where spend on mobile has overtaken desktop), with the top ten in terms of mobile share coming from a mix of Western and Eastern European nations.

Across all formats, mobile ad spend is still catching up to changed media consumption habits, especially outside of the social platforms. As the social share of digital ad spend begins to plateau, this is where new pockets of growth are emerging. The ascent of digital audio advertising around music streaming and podcasts, is also predominantly mobile. This will be further fuelled by the proliferation of connected cars in the years ahead.

AdEx Benchmark is the definitive guide to the state of the European digital advertising market.  The report reveals the key milestones contributing to the 2018 market value of €55bn and the fastest growth since 2011.

The report provides a comprehensive perspective of digital advertising spend across Europe which is essential in benchmarking market development trends, the increasingly pan-regional nature of digital advertising investments and the role of Europe’s digital economy in a global context, attracting global start-up funding and European policy formulation.

Based on a study of twenty-eight markets in Europe, the report includes data on social ad spend and splits video by in-stream and out-stream. Out-stream video and mobile both dominated results in 2018, as they both grew by double-digits in all twenty-eight markets. Out-stream video grew by 44.7 percent on average, compared to in-stream at 19.7 percent. Overall, video grew by 30.9 percent, to €7.6bn, accounting for 33 percent of the display market.

The results and trends highlighted in the AdEx Benchmark Report will be discussed in our first Economic Trends Forum webinar on 25th July at 15.00 CEST / 14.00 BST. Find out more about the IAB Europe Economic Trends Forum here. 

You can download the full report below

The AdEx Benchmark study is the definitive guide to the state of the European digital advertising market, covering 28 markets, and is now in its thirteenth year. In 2018, a total of twenty-one markets saw double-digit year-on-year growth.

Access the study below.

Irish Digital Advertising Spend grew by 17% in 2018 according to the latest IAB / PwC Online Adspend Study.

• Total Digital adspend is €574m reflecting year-on-year growth of 17% for 2018
• Mobile adspend reaches €376m for the year ended 2018, with a growth rate of 43% over 2017
• Social and Video drive online Display advertising’s 18% growth to €250m in 2018
• Search retains its 50% share of digital advertising in 2018 with an adspend of €286m

Digital advertising spend in the Irish market for 2018 reached €574m according to the latest results of the IAB PwC Online Adspend report, reflecting a growth rate of 17% year on year.

Display advertising grew by 18% to €250m in 2018, this growth was driven by Social with a 31% growth rate YoY and Video with a 34% growth rate YoY.

Search advertising grew by 17% in 2018 with an adspend of €286m and a share of 50% of the total Irish digital advertising market.

Classified advertising online performed strongly with a 10% growth rate year on year and a 7% share of the total 2018 online adspend at €38m.

Download the infographic below.

For further information please contact: Maeve O’Meara, Marketing Manager, IAB Ireland, 086 852 2291, maeve@iabireland.ie

This article was originally published here.

According to IAB Turkey AdEx-TR 2018 Report digital ad revenues reached 2,47 billion TL with a growth of 14,2%

IAB AdEx-TR 2018 report reveals that display ad revenues reached TL 1,41bn by growing 15%. Advertising based on Display/Click gets the biggest share under Display category with TL 969M. On the other hand, Video ad revenues reached to TL 353M with a growth rate of 31% and Native to TL 101M.

Search Advertising revenues which consists of Keyword Based Advertising completed 2018 with TL 923M, where Classified & Directories rose to TL 113M. E-mail marketing ad revenues which had declined in previous years, continued to decline by 5% with nearly to TL5M.           and, in-game advertising reached TL 17M.

While TL 1,4bn out of TL2,47bn was spent on mobile platforms, 79% of the social media ads (TL411M in total) took place on mobile platforms. Programmatic ad-spend hit TL 1,69bn and continued to increase in 2018.

Neslihan Olcay, IAB Turkey’s Chairwoman said, “According to e-marketer[1], in 2018 global ad spend will reach $628.6bn and digital will be the driving force of advertising industry with a share of 43,5%. In a relatively difficult economical period, Turkey succeeded to grow in double digits once more. We foresee that video ads which grew by 31% in 2018 will follow the same path in 2019 since Fair Usage Quota has been removed. As of next year, making a methodological improvement in AdEx study and providing more detailed information to the industry are within the plans. 

In this context, I’d like to emphasize that new research projects will be among top priorities in addition to AdEx-TR. The Research Committee recently founded will conduct diversified research studies related to the market and will support the industry and foreign investors’ decision-making processes.

In 2019, we’ll also initiate new working groups, namely B2B and AdTech & MarTech. These are two major topics expected to grow. M2M (Machine to Machine) marketing will be another interesting topic in a couple of years. Moreover, even today Digital extends beyond the advertising, therefore Direct Brand Economy will also be in our agenda. And we will definitely keep the current projects by improving them.”

*Agency fees, production costs and direct buys are not involved.

**Social media, mobile and programmatic are included under Format based Digital Ad Investments and should not be added to total value

[1] May 2018

The AdEx Benchmark H1 2018 Study reveals that mobile ad spend crossed the €10bn mark and is approaching a 50% share of digital ad spend. The latest European Programmatic Market Sizing Report published by IAB Europe and IHS Markit shows that more than half of programmatic display spend is in mobile formats.

Video grew by more than 4 times total display and now accounts for 30% of the display segment. This expansion of video has increased the total display’s share of the overall digital ad spend market.

Display advertising growth continues to outpace search[1]; display grew by 12.3% and search by 10.2%. Display reached over €10bn in H1 2018 representing 40% of total digital advertising whilst search accounted for 46%.  Display advertising continues to experience strong growth in Central and Eastern Europe; in H1 2018 it grew by 17.9% compared to 11.2% in Western Europe. Indeed, the CEE region helped to drive the overall growth with an increase of 17% whilst the more mature markets in Western Europe experienced a growth of 9%.

Looking ahead IHS Markit estimates that digital ad spend will surpass €50bn in 2018.

Register below to download the full study

Pertaining to this growth, 62% of European display ad spend was traded programmatically in 2017. Mobile continues to be the ‘most’ programmatic format as more than 80% of mobile was traded programmatically whilst video catches up – 74.1% of video was traded programmatically. Further, programmatic video is the force behind the growth as it saw 64.6% growth followed by programmatic mobile at 53.2%.

Whilst CEE is still small in size it continues to make large gains and grew by 65% compared to Western Europe which grew by 24%.

Programmatic revenues by format:

• Mobile - €6.8bn
• Video - €3.9bn

Programmatic revenues by region:

• Western Europe - €10.8bn
• Central and Eastern Europe - €1.2bn

Register and download the report below:

The European Digital Advertising market has doubled in size in 5 years reaching €48bn in 2017 compared with €24.8bn in 2012. The market grew by 13.2% in 2017, driven by strong growth in social, mobile and video investment. This webinar dove deeper into trends, formats and market by market growth across Europe.

Daniel Knapp, Executive Director TMT at IHS Markit, IAB Europe’s research partner, presented the key findings of the AdEx Benchmark report. This was followed  by a panel discussion between industry leaders commenting on the findings and their perspectives on future trends.

Panelists:

Daniel Knapp, Executive Director TMT, IHS Markit	Kristiana Carlet Stagno, VP of EMEA Partner Markets and Nordics, Oath	Tyson Pearcey, Head of Strategic Partnerships, NewBase	Stevan Randjelovic, Brand Safety Manager, GroupM

Watch this recording to find out more about:

• The European digital advertising market: size and growth
• Comparison of 27 European markets
• How online advertising performs compared to other media
• Trends in display, paid-for-search, classifieds & directories
• The rise of video and mobile advertising in Europe
• What is driving growth in the market?
• What is holding back online advertising?