Advertising Trends: Why is Online Ad Spending on the Rise?

In case you haven’t noticed, advertising on the Internet is everywhere—and I mean everywhere! When you check your email, you see ads in the sidebar. On Facebook, you are confronted by ads that attempt to capitalize on the things you talk about with your friends or links that you post. When you are catching up on your favorite blog, you might also see a banner ad for a pair of running shoes that you had checked out online a few days before.

In the past five years, there has been a steadily increasing stream of marketing capital dedicated to online advertising and with good reason. According to a Nielsen online survey, over 85% of people reported using the web to make a purchase. This may have occurred as a direct online purchase or as time spent researching a product or service on the web before choosing to it buy in-store.

Either way, the trend of marketing dollars moving away from traditional advertising mediums to online strategies is one that continues to grow. In a new report from GroupM, online ad spend is expected to reach $113.5 billion worldwide this year. Below, we take a look at why online ad spend continues to increase,  strategies currently being implemented by online advertisers, and what is on the horizon when it comes to online marketing strategy.

Why is Online Ad Spending Increasing?

In order to understand why businesses are spending more of their advertising budget in the online realm, we need to examine things from the perspective of businesses as well as from online shoppers.


For construction businesses, one of the main draws of builders advertisement is attribution. Since becoming a viable advertising strategy, the ability to track performance and assign attribution has been one of the strongest advantages that online advertising has over traditional advertising mediums like television, radio, and print. As this attribution continues to improve in accuracy and reach, more and more businesses are seeing better results and implementing more effective marketing campaigns by leveraging their online marketing data.

Secondly, the use of the web among the world’s population continues to grow, creating more opportunities for businesses to find new customers. According to Internet World Stats, the amount of people using the Internet worldwide has grown by 566.4% since 2000. In the United States, nearly 80% of the population uses the Internet in some capacity. With this huge audience, increasing online ad spend certainly makes sense from a business perspective.


On the other side of the equation are customers. The number of people purchasing online or researching online to make a buying decision later on continues to increase as well. Among the factors leading to this increase is the explosion of social media. It seems like every day, a new social sharing website pops up allowing us to tell our friends and family all about the new dress we just bought, the restaurant tried, or the book we just read. Social media has taken the importance of word-of-mouth advertising to a whole new level, and marketers are taking note.

Add to this an increase in product information, reviews, the ability to make a purchase instantly, and more competitive pricing, and it is easy to see why more and more consumers are choosing to do their shopping online. And where there are more shoppers, there will be more advertising.

How are Advertisers Capitalizing on this Increased Ad Spend?

Online marketers are a savvy bunch, and they are especially adept at leveraging the wealth of information the Internet provides to help create the most efficient and effective advertising strategies possible. Not only does this include tried and true online advertising strategies like search engine optimization, pay per click advertising, banner advertising, and email marketing, but also newer strategies like Remarketing, conversion rate optimization and social media advertising.

In addition to these “off-site” marketing strategies, online advertisers continue to implement proven on-site marketing strategies in order to create the most effective online advertising campaigns possible. These on-site strategies include everything from layout and design to the number of steps in the purchasing process.

What’s Next?

Most online advertising experts agree that the trend of increased mobile web traffic will continue, which means more advertising strategies (and dollars) focused on targeting those users. Mobile advertising still has a lower overall cost per click than other forms of online advertising, which is another reason why so many advertisers are keen to target this segment of the market.

As mobile search trends increase, so does the importance of cross-channel and cross-device marketing.  The goal will be to track and target a potential customer from their first product search on a smart phone to their search of reviews by search engines and social media, to their final purchasing decision.

Social media marketing will also continue to grow in importance, particularly in the areas of brand awareness and Remarketing. Targeting people who have expressed interest in a brand or product on Facebook, Twitter, or other social media site will become a larger part of online advertising campaigns, and will also contribute to the increase in total online ad spend.

What are your thoughts about the future of online advertising? Share them in the comments below!

Source: Daniel Yomtobian by

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