Online display advertising spend in Europe will grow from €7.3 billion this year to €11.9 billion in 2019 — a 10.3% compound annual growth rate (CAGR) according to Forrester’s latest five-year forecast. In the US, online display ads will grow at 13.7% CAGR over the next five years. The increase in Europe is driven mainly by the growth of advertising on mobile devices and the explosion of video as an online advertising format.
European marketers will favor rich media and video formats over static and text ads. Video ad spend in particular will take off quickly and grow at an impressive 20% CAGR between 2014 and 2019, driven by a combination of high demand, high consumer engagement, and high CPMs.
Furthermore, tablet display is taking off full-speed in virtually every European market, writes Researcher Samantha Merlivat in her blog post: “With their larger screen real estate and growing role in customers’ path to purchase, tablet-based ads will grow at a 40.5% CAGR over the next five years, attracting a third of total online display revenue by 2019.”
While these growth trends hold true throughout Western Europe, distinctive patterns will emerge with regard to display spend across devices. For instance, online display advertising spend on PCs will stagnate and grow by a meager 1% CAGR between 2014 and 2019. Mature markets such as Norway and the UK will see negative growth over the same period — as low as -6.3% CAGR for the UK. By 2019, Forrester forecasts that PCs will represent roughly 52.2% of total online display advertising, down from 80.8% in 2014. Advertising spend on smartphones will continue to grow at a steady 20.5% CAGR over the next five years across Europe. The growth curve is starting to flatten for the UK, Norway, and the Netherlands, where the bulk of new investment will be directed at tablets.