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November 26, 2012

Social Media Ad Revenue to Hit $9.2 billion in U.S. By 2016, Predicts BIA/Kelsey

By David Gitonga, TMCnet Contributing Writer

In the year 2012, we have witnessed a commendable rise in the use of social media as ad deployment platforms. According to a forecast put forth by BIA/Kelsey, U.S. social media ad revenue will hit $9.2 billion in 2016. This is an immense growth from the current $4.6 billion and translates to a compound annual growth of 19.2 percent.

The innovations founded in 2012 are clearly the ‘godfathers’ to this projected revenue collection. BIA/Kelsey bases its predictions on the ability to create native ads like Facebook’s Sponsored Stories, Twitter’s (News - Alert) Promoted Tweets and the accelerating mobile monetization solutions to improve on ad effectiveness.

Image via Shutterstock

BIA/Kelsey believes that social media advertising, which it defines as money used on advertising formats across social networks, will increase from the current $3 billion to $5.4 billion. During this time span, social display advertising will make for the highest percentage revenue courtesy of Facebook’s MarketPlace Ads and YouTube’s (News - Alert) dual display units in video and traditional banners.

On the other hand, BIA/Kelsey predicts a $2.4 billion increase on social native advertising. Defined as branded content integrated within social network experiences, BIA/Kelsey believes that social native advertising will manifest immense growth during the four forecast years with its drive being the higher premium native social ad units command.

The last key feature pointed out in the forecast is the potential growth in the mobile social media field. BIA/Kelsey estimates a social-mobile ad revenue increase from $500 million in 2012 to $1.5 billion in 2016. The report attributes this growth to a swift social-mobile consumer usage expansion, active experimentation by vendors and deep integration of native ad components into the platform.

Want to learn more about the latest in communications and technology? Then be sure to attend ITEXPO Miami 2013, Jan 29- Feb. 1 in Miami, Florida.  Stay in touch with everything happening at ITEXPO (News - Alert). Follow us on Twitter.

Edited by Brooke Neuman
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