The digital advertising industry is growing at a remarkable rate.
According to market research firm Nielsen, digital advertising revenue grew 7.7% in 2016, beating expectations and the market is expected to grow by nearly 20% over the next two years.
But there’s one key area of growth that is being left behind: television.
Nielsen says television viewing has fallen by 8% from 2016 to 2017, a sharp drop from 2015.
And the number of viewers watching television on mobile devices has dropped by a third from 2016 through 2017.
Digital advertising is expected for a major push in 2018, with a major shift to mobile in 2019.
A recent report by Digital Advertising Alliance predicts that the growth of digital advertising will exceed television ad revenue for the first time in 2017, and that it will surpass television ad revenues for the third time in 2018.
And if the digital advertising trend continues, it could help the ad tech sector.
“It’s a big change,” said Ben White, head of global research at Kantar Media/CMAG.
“I think you’ll see the industry really take off in 2018.”
But it’s not only the ad technology sector that will be impacted by digital ad growth.
The digital media landscape is also growing.
According the Ad Age magazine, the number growth in ad revenue in 2018 was up 5.2%, from $13.6 billion in 2017.
That’s up from $12.7 billion in 2016.
Ad Age says that “the growth in digital ad revenue is driven by more consumers paying for ads online than ever before, as they increasingly opt to use mobile devices as a primary means of viewing TV content.”
It’s a trend that will continue to grow as digital ad spending continues to rise, according to a recent study by Kantar, with the average mobile user spending more than five hours per day on the platform.
And a recent survey by the market research company eMarketer found that the average ad spend by the US household rose from $26.6 in 2017 to $31.1 in 2018; a whopping 24.3% increase.
Ad spend by millennials is also up, with an average of $10.8 billion in 2018 on average.
Digital ad revenue has been on a tear since 2016, but it’s only going to get better.
“We’re going to see this momentum for advertising accelerate,” said White.
“Digital ad revenue, once it really catches on, is going to be very big.”
And that’s why digital advertising companies like Zendesk, adtech startup Adblock Plus, and ad tech company Adblock.io have all begun working on ways to build out ad tech companies, including Zendysadio, which will offer mobile ad tech.
Zendosadio has a goal of providing a full suite of mobile ad services, including mobile apps for TV, web, video, and more.
Adblock’s founder Ben White says he’s excited to see the “next big thing” in ad tech and thinks digital ad will be a big part of that next big thing.
“If you look at the history of ad tech, there have been a number of ad technology companies that were around for quite a while and were trying to figure out how to compete and survive,” said President and CEO of Adblock, Mike Cernovich.
“Now it’s time to see what happens when all these companies merge and start working together and become one company.”
That said, there are still a lot of hurdles to overcome before digital ad is ready for prime time.
The ad tech industry is still in its infancy and many of the key players still haven’t even had a chance to get their products out into the market.
And even if digital advertising is the future of TV advertising, it will be far from the first.
“There’s still a long way to go, but I think that’s the direction we’re going,” said Zendecosdio’s White.