New figures from Forrester Research show the US interactive advertising market is set to reach $55 billion over the next five years.
The forecast also shows that marketers will go from spending just 12% of total advertising budgets online to 21% of advertising budgets by 2014.
The search and display advertisements will be the leader of the pack, recording $31.5 billion and $16.9 billion in spending respectively by 2014. However, the majority of the growth is set to come from social media and advertising on mobiles.
Advertisers will spend an estimated $716 million on social media advertising and marketing this year, but that will jump by a massive 34% to $3.1 billion in 2014.
Additionally, mobile advertising will grow by 27%, from $391 million this year to $1.2 billion in five years' time.
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This is because social media not only embraces a new way of business for advertising and marketing, but also for PR, service, support, product development, business development, and potentially logistics and distribution. That is, think of social media as a service function which changes many if not most of a company's interactions with customers.
This does not mean that in total more money will have to be found. Funds from existing budgets will be diverted. The total spend, when added up across an organisation, will be much larger than "social media advertising", and it is trending up rapidly.
Walter Adamson, @g2m
http://www.socialmedia-academy.com.au