• by Jack Loechner , Staff Writer @mp_research, May 1, 2015

According to the Marketing Charts review, The Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC) have released their latest Internet advertising revenue report covering Q4 and full-year 2014. The results remain generally consistent with the past couple of years, says the report, with overall growth in the double-digits, driven by mobile.

The report indicates that online ad spending grew by 15.6% year-over-year in 2014, from $42.8 billion to almost $49.5 billion. The year-over-year growth rate in Q4 of 17% matched last year’s Q4 growth rate, but the quarter-over-quarter growth rate in Q4 of 16% was the largest in more than a decade.

Much of the growth in online advertising spending is going to mobile, notes the report, as full-year mobile ad spending grew by 76% year-over-year. From 2010 through 2014, mobile advertising spending has grown at a compound annual rate of 110%, 11 times faster than non-mobile’s rate of 10%.

According to the study, the compound annual growth rate of 110% in mobile advertising’s first 5 years is not quite as fast as the comparable rate for internet advertising in its first 5 years, which grew at an annual rate of 135%. It is, however, considerably faster than the inflation-adjusted rates for broadcast TV (79% CAGR) and cable TV (69% CAGR), per the IAB’s calculations.

In 2014, non-mobile search accounted for 38% of total spending, down from 43% in 2013. By comparison, mobile grew from 17% share of online ad revenues in 2013 to 25% last year. Three-quarters of online ad spending continues to flock to other devices, the vast bulk of which is presumably desktop/laptop spending, says the report.

Mobile advertising spend also is comprised of a variety of formats, almost evenly split between search and display, with other formats accounting for the remaining share. As such, combining mobile and desktop search means that half of all online ad spending, regardless of device, went to search advertising last year, says the report.

Meanwhile, non-mobile display advertising, consisting of banner ads, digital video, rich media, and sponsorship, comprised 27% share of full-year revenues, down from 30% share a year earlier. As a result, mobile advertising now rivals non-mobile display advertising in size.

Again, the mobile ad revenues also comprise mobile display. Combining mobile and non-mobile display advertising results in display accounting for roughly 40% share of total online advertising spending.

In terms of growth rates :

• Mobile ad spending grew by 76% to $12.5 billion
• Non-mobile search increased by 3% to $19 billion
• Non-mobile display-related spending rose by 5% to $13.5 billion
• Non-mobile digital video spending grew by almost 18%, to $3.3 billion.

One of the other key trends to emerge from the study is the rapid growth in social media advertising, with revenues exceeding $4 billion in the second half of the year. In fact, the $4.1 billion in social ad spend in H2 represents 58% year-over-year growth from the second half of 2013, and social media ad revenues totaled $7 billion for full-year 2014, up almost 56% year-over-year.

For more information from the IAB please visit here.