Retailers to spend record high on digital ads in 2013

Steven Loeb · November 27, 2013 · Short URL: https://vator.tv/n/337c

Spending will reach 9.5 billion, an increase of almost 16% from last year.

We already know that the rise of mobile has led to a rash of deals this holiday season. What used to be a single day of spending has now been stretched out to at least a week of overwhelming, and endless, discounts and savings.

(Hint to retailers: if your prices are always at a discount, it's no longer a sale. Those are just your prices!)

And now comes the other side of that equation: letting people know that those deals and discounts, you know, exist. That means heavy marketing and, so, as a result, digital ad spending by retailers in the United States is going to hit a record level this year.

Digital ad budgets for U.S. retailers will reach a new high of $9.50 billion in 2013, according to a report out from eMarketer on Wednesday. That is an increase of 15.7%, compared to the 14.5% year to year growth the space saw last year.

Right now, retailers account for nearly a quarter, 22.3%, of all digital ad spending in the U.S. But here comes the bad newsL even though spending is expected to continue rising every year for at least the next four years, the percent change is expected to slow.

By 2017, ad spending by the U.S. retail industry will only be increasing by 7.5% year to year. 

That will result in retailers remaining with the same market share they have right now, "as the overall market grows slightly faster than retail."

So, what is account for all the spending this year? It is a direct result of buying holiday advertisements, according to eMarketer. As the site pointed out, "the last months of the year account for a disproportionate share of retail revenues."

And, indeed, eMarketer is predicting that 23.5% of e-commerce sales are going to take place in either November or December of this year, for a total of $61.8 billion. And Adobe has already been predicting that this will be the biggest holiday shopping season ever. 

Online sales on Thanksgiving will be $1.1 billion, Adobe said, an increase of 21% from last year. And Black Friday will see $1.6 billion, up 17% from last year. 

Last year's Black Friday broke $1 billion for the first time ever, while shopping on Thanksgiving also broke online sales, hitting over $600 million.

But the real money has, and will probably always, come on Cyber Monday. Shopping on the first Monday following Thanksgiving will increase by 15% year year, for to a total of a whopping $2.27 billion spent. Remember that last year's Cyber Monday was the biggest shopping day of all time

Overall, retail ecommerce sales in the United States are expected to grow 16.4%, to $262.3 billion, this year, according to eMarketer.

(Image source: https://urbanemedia.co)

Support VatorNews by Donating

Read more from our "Trends and news" series

More episodes