Why our forecast of 2021 US Programmatic Digital Display Ad Spending is now $15 billion higher

This is the first in a series of analyst notes discussing our May 2021 US programmatic digital display ad forecast update.

Advertisers in the US will accelerate growth in their programmatic digital display ad investments this year as spending approaches $97 billion. That will represent a 29.0% increase over 2020 and will account for more than 89% of all digital display ad spending.

US programmatic digital display ad spending continued growing at double-digit rates during the pandemic, and we expect it to reach a milestone next year when more than 9 in 10 digital display ad dollars are transacted using some form of automation.

This forecast update, completed in May 2021, is a significant upward revision to our last set of estimates of US programmatic digital display ad spending, which we published in October 2020. Last October, we predicted US advertisers would spend $65.74 billion on programmatic digital display ads in 2020. We now estimate that they spent almost $10 billion more than that, $75.09 billion. The upward revision for this year is even greater—more than $15 billion.

There are two reasons for our much more positive revised outlook for programmatic display:

• Between October 2020 and March 2021, we revised our underlying estimates of US digital display advertising upward. The digital ad market’s pandemic recovery in Q3 and Q4 2020 occurred more rapidly than we had expected, leading us to increase our estimate of 2020 US digital display ad spending from $77.79 billion in October to $85.18 billion in March. Those changes flowed through to our programmatic breakout and resulted in higher estimates of pandemic performance and future spending as well.
• This spring, we also made big changes to how we model US programmatic ad spending. We re-analyzed how we were applying our definition of programmatic advertising across social media and audio properties, resulting in an upward revision to our estimate of the share of digital display ad spending that is transacted programmatically. And with more programmatic ad tech firms filing public reports than ever, we have been able to rely more on that new information to inform our estimates.