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Social network ad spend growth will slow in 2015: report

In 2015, the global ad spend on social networks is expected to increase 29 percent and reach $19.8 billion, down from a 41 percent growth rate in 2014, according to a new report from Strategy Analytics. 

The United States leads with the largest share of global social network ad spend at 41 percent for a total of $6.2 billion, which is a 35 percent increase year-over-year. U.S. marketers also spent the most social network user in 2014 at $31.37, a number that is expected to grow 27 percent in 2015 for a total of $39.84

?Mobile social network space has definitely grown in the last couple of years and it is where most of advertising dollars has been spent within social network space and where it will continue to occur,? said Leika Kawasaki, author of the report and an analyst at Strategy Analytics

?For example, when looking at Facebook?s mobile advertising revenues, in 2014 majority 63 percent, or $7.2 billion, of Facebook ad revenues came from mobile, while in 2011 mobile ad revenue was zero,? she said. ?Since the launch of Facebook mobile ad strategy in 2012, it has gradually grown. 

?Facebook mobile ad revenue has grown from accounting for 11 percent of total ad revenue in 2012 to 45 percent in 2013 to 63 percent in 2014. 

?This shows us a trend that will continue as users continue to spend more time on mobile devices than desktops.?

2 billion users
?As social network use continues to grow, with much of the use taking place on mobile devices, marketers are increasingly funneling money into the channel. 

Globally, social networks surpassed 2 billion users for the first time in 2014, of which Facebook accounted for 68 percent.

By 2016, the global ad spend on social networks is expected to reach $24.2 billion, according to Strategy Analytics? Global Social Network Forecast. 


In 2014, ad spend on social networks was up 41 percent globally for a total of $15.3 billion and accounting for 11 percent of the global digital ad spend. 

Facebook accounted for three-quarters of global social network ad spend in 2014, while Twitter accounted for 8 percent. 

Facebook alternatives
Britain is the second largest market for social network ad spend, accounting for 8.2 percent of global social network ad spend in 2014. China followed with 8 percent. 

Facebook?s absence in China is allowing local social networks such as QZone and Tencent Weibo to gain traction in the region?s rapidly expanding digital advertising market. 

Additional key findings from the report include that 46 percent of social network users reside in the Asia Pacific region, with China accounting for almost 25 percent of global social network users with 495 million users in 2014. 

North America had the highest ratio of social network users to its population ? 64 percent -  in 2014, followed by Western Europe at 55 percent. 

?In the overall Global perspective Facebook will continue to dominate the social ad spend,? Ms. Kawasaki said. ?There is no other social network service successful as Facebook that leads in social network space across multiple countries and regions.

?Other major global platforms like Twitter and LinkedIn are just too far away to become the next Facebook in terms of monthly active users and advertising revenue,? she said. 

Final Take?
Chantal Tode is senior editor on Mobile Marketer, New York