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Auto Sector Leads Digital Ad Investment in Canada

Consistent digital ad spend growth projected for coming years

Digital ad spending in Canada is expected to represent nearly a quarter of total media ad investment in 2013. The next several years will see that proportion climb even higher, eMarketer predicts in a new report, “Canada Digital Ad Spending: Mobile and Video Investment Will Lead Further Growth.”

Digital ad spend growth in Canada was 15.4% in 2012, driving investment above CA$3.0 billion and equating to 21.9% of the country’s total media ad spending. By comparison, the US’s digital share of 22.3% in 2012 was approximately the same level as Canada’s, but is projected to grow faster in the coming years. The UK’s digital share of 40.3% in 2012—the highest worldwide—far exceeded both.

eMarketer predicts consistent digital ad spending growth in Canada through 2017, based on the general economic health and high broadband household internet penetration in the country (79% in 2012), and that 77.5% of residents will go online at least once per month this year.

A breakdown of 2012 digital investment by industry highlights a recovery by the automotive sector. According to IAB Canada’s online advertising revenue survey, the automotive sector commanded a leading 17% share of Canada’s digital spending, up 15% from 2011. Other major industries included consumer packaged goods (12% share), retail (12%) and financial services (11%).

“We see very strong spending in the automotive sector,” said Bob Reaume, vice president of policy and research at the Association of Canadian Advertisers (ACA). “This is something new in the last 18 months.”

Assessing digital marketing activity by ad spend alone, however, provides an incomplete picture. Heavy investments by brands in content, digital infrastructure, responsive design websites and digital direct marketing efforts typically go unreported as ad spending.

There are also the blurred lines associated with the digital versions of traditional media properties. “Digital is not so much a medium as several media on a different platform,” Reaume said. “So within that digital spend, you have (digital branches of) magazines, television, radio and different newspapers.”

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