Social ad spend rising faster than video in 2011

Ronny Kerr · August 17, 2011 · Short URL:

Still an unstoppable star, social media to fuel advertising dollar growth from $1.99B to $3.08B

Though it’s well-established that 2009 and 2010 were monumental years for the social media boom, this year seems to be the beginning of that boom’s tapering off point. The social media user slowdown appears to be supported both by third-party reports that Facebook’s membership growth has slowed as well as by Mark Zuckerberg’s own admission that our focus should turn from tracking pure user count to tracking user sharing.

There is, however, one area where social media continues to dominate growth in 2011: advertising spending. More than lead generation, more than search and even more than video, social network will see the fastest growing advertising spending online.

Representing a 55.0 percent increase from the year before, marketers in the U.S. are set to spend $3.08 billion on social network advertising this year, according to eMarketer. In 2010, spending reached $1.99 billion.

The next fastest growing format is video, where ad spending is estimated to grow 52.1 percent from $1.42 billion in 2010 to $2.16 billion in 2011.

Interestingly enough, social media and video ad spending were neck in neck in 2010, in terms of both overall value and growth rate. Social network ad revenues increased by 39.0 percent to $1.99 billion and video ad revenues increased 39.6 percent to $1.42 billion.

The future looks even curiouser than the past. In 2012, for example, social media will see another tapering off, with ad spending growing just 27.7 percent to $3.93 billion. Video, on the other hand, should continue blazing ahead, growing 43.1 percent to $3.09 billion.

When looking at the entire market for the current year, social media ad dollars will make up 10.8 percent of the total spent online in the U.S. whereas video will make up about 7.0 percent. Both are dwarfed by search, whose $14.38 billion in spending this year will account for 46.0 percent of the total ad spend.

Support VatorNews by Donating

Read more from our "Trends and news" series

More episodes