US Native Social Ad Revenue Forecast Revised Upwards

December 18, 2013

This article is included in these additional categories:

Digital | Mobile Phone | Social Media | Tablet

BIAKelsey-US-Social-Ad-Revenues-2012-2017-Dec2013BIA/Kelsey has released an update to its social local media forecast from earlier this year, and the revision predicts faster growth for native social ad revenues than previously expected. In this latest forecast, native social ad revenues – primarily driven by Facebook’s Sponsored Stories and Twitter’s Promoted Tweets – will reach $5 billion in 2017, up from roughly $4.6 billion in the previous forecast.

The researchers expect native ads to account for roughly 36% of total social ad revenues this year ($2.4 of the $6.7 billion), before growing to represent about 42% of the total in 2017 ($5 of the $11.9 billion). The primary social revenues stream – display advertising – will grow quickly in its own right, predicted to increase at a compound annual rate (CAGR) of 18.3% from 2012 through 2017. But native ads’ 29.6% CAGR means that native ads will actually contribute more to social media ad growth between 2013 and 2017 than display ads (an additional $2.6 billion for native versus $2.5 billion for display).

Turning to social’s mobile ad revenues, BIA/Kelsey predicts an increase from $1.6 billion this year to $3.5 billion in 2017, for a CAGR of 21.3%. That would put mobile at close to 30% of total social media ad revenues. (For context, Facebook appears to be ahead of the pack, having recently reported that mobile makes up 49% of ad revenues.)

Finally, BIA/Kelsey expects that locally targeted social media advertising will grow at a 22.6% per-annum clip, reaching $3.9 billion in revenues by 2017, or 36% share of total social ad revenues.

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