BIA/Kelsey recently revealed projections for social media ad revenue growth through 2018. In their 2014 U.S. Social Local Media Forecast, BIA/Kelsey projects social media ad revenues to grow from $5.1 billion in 2013 to $15 billion in 2018. This represents a 24% compound annual growth rate (CAGR).
2014 social media ad revenues are expected to rise to $8.4 billion. This increase over the $5.1 billion in revenues in 2013 represents the largest year over year increase in social media ad revenues. The growth between 2013 and 2014 has been driven by mobile and native advertising spend. Native advertising is largely defined as purchased ads that mimic the content on the site. For example, Facebook sponsored stories and Twitter promoted tweets are largely considered native ads.
The 2014 Social Local Media Forecast also projects social display ad revenues would grow to $5.6 billion in 2018 from the $3.3 billion seen in 2013. This represents a CAGR of 11.3%. Social native advertising revenues are expected to increase from $1.8 billion in 2013 to $9.4 billion in 2018. Social native advertising is expected to eclipse social display in 2015 when social native ad spend is projected to come in at $5.3 billion vs. social display at $4.7 billion.
BIA/Kelsey also predicts mobile social ad revenue will surpass desktop social ad revenue by 2018. With a 31.6% CAGR, locally targeted social advertising is expected to increase from $1.3 billion in 2013 to $5.2 billion in 2018.
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