Social Video Ad Spending Forecast 2023

A Behind-the-Scenes Look at Social Networks’ Biggest Source of Ad Revenues

Report by Evelyn Mitchell-Wolf  | Jan 24, 2023
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Table of Contents
Executive Summary
Social media will be the channel hit hardest by the digital advertising downturn.
Social video ad budgets will weather the storm better than their nonvideo counterparts.
Video now accounts for over half of all social network ad revenues.
Meta still commands the largest share of the market, but its dominance is waning.
As ad revenues falter, Meta’s growth strategy is all in on video.
Snapchat’s growth rivals the giants.
Twitter weighs down social video as it struggles to keep its head above water.
TikTok’s meteoric growth is cooling, but it’s still the envy of competitors.
YouTube is taking on social networks and streaming platforms in time spent—and ad revenues.
While advertisers can repurpose content across platforms, they shouldn’t.
Video ads will be at the center of social commerce initiatives as platforms battle it out for market share.
Creator-produced video is becoming a bigger piece of the paid social puzzle.
Revenue sharing models signal who will win with creators—and ultimately marketers—long term.
Social video advertisers have three big opportunities.
Sources
Media Gallery
About This Report
Facing signal loss and challenging macroeconomic conditions, advertisers are pumping the brakes on social network ad spending. But social video is shining through the gloom.
Topics
Social Media Ad Spending
Video Advertising
US
Table of Contents
Executive Summary
Social media will be the channel hit hardest by the digital advertising downturn.
Social video ad budgets will weather the storm better than their nonvideo counterparts.
Video now accounts for over half of all social network ad revenues.
Meta still commands the largest share of the market, but its dominance is waning.
As ad revenues falter, Meta’s growth strategy is all in on video.
Snapchat’s growth rivals the giants.
Twitter weighs down social video as it struggles to keep its head above water.
TikTok’s meteoric growth is cooling, but it’s still the envy of competitors.
YouTube is taking on social networks and streaming platforms in time spent—and ad revenues.
While advertisers can repurpose content across platforms, they shouldn’t.
Video ads will be at the center of social commerce initiatives as platforms battle it out for market share.
Creator-produced video is becoming a bigger piece of the paid social puzzle.
Revenue sharing models signal who will win with creators—and ultimately marketers—long term.
Social video advertisers have three big opportunities.
Sources
Media Gallery

Executive Summary

Video formats officially account for more than half of ad spending on social networks in the US. As legacy platforms defend their market share against TikTok’s advance, advertisers have more social video options than ever before.

KEY QUESTIONS

  1. How will social video fare during the expected ad downturn?
  2. Which platforms are winning the social video race?
  3. What role will social commerce and creators play in the social video landscape?

Social media will be the channel hit hardest by the digital advertising downturn.

We downgraded our 2023 US social network ad spending forecast by $16.21 billion—the biggest reduction of any channel—as difficulties abound. Why?

  • The impact of Apple’s and other privacy changes has shocked the system. Digital ad targeting and measurement have been changed, permanently. Since the majority of time spent with social media occurs on mobile apps, AppTrackingTransparency has been especially debilitating for social networks, which now have a lot less data to work with.
  • Macroeconomic headwinds aren’t easing. Some advertisers are pulling back on spending as they face inflation, a potential recession, ongoing supply chain disruption, and geopolitical instability. Meta, Snap, Pinterest, and Microsoft, which owns LinkedIn, all cited difficult economic conditions in their most recent earnings calls.
  • Normalization is here after a radical rebound. Advertisers boosted spend big-time in 2021 as they recovered from the pandemic slump. But 2021 was an outlier, and ad spending has come back down to earth.
How Has Our US Social Network Ad Spending Forecast Changed?
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Table of Contents

  1. Executive Summary
  2. Social media will be the channel hit hardest by the digital advertising downturn.
  3. Social video ad budgets will weather the storm better than their nonvideo counterparts.
  4. Video now accounts for over half of all social network ad revenues.
  5. Meta still commands the largest share of the market, but its dominance is waning.
  6. As ad revenues falter, Meta’s growth strategy is all in on video.
  1. Snapchat’s growth rivals the giants.
  2. Twitter weighs down social video as it struggles to keep its head above water.
  3. TikTok’s meteoric growth is cooling, but it’s still the envy of competitors.
  4. YouTube is taking on social networks and streaming platforms in time spent—and ad revenues.
  5. While advertisers can repurpose content across platforms, they shouldn’t.
  6. Video ads will be at the center of social commerce initiatives as platforms battle it out for market share.
  1. Creator-produced video is becoming a bigger piece of the paid social puzzle.
  2. Revenue sharing models signal who will win with creators—and ultimately marketers—long term.
  3. Social video advertisers have three big opportunities.
  4. Sources
  5. Media Gallery

Charts in This Report

How Has Our US Social Network Ad Spending Forecast Changed?US Meta Video Ad Revenues, 2019-2024 (billions, % change, and % of total Meta ad revenues)
US Snapchat Video Ad Revenues, 2019-2024 (billions, % change, and % of total Snapchat ad revenues)US TikTok Ad Revenues, 2019-2024 (billions and % change)
US Social Commerce Buyers, by Platform, 2019-2025 (millions)US Influencer Marketing Spending Share, by Platform, 2019-2024 (% of total influencer marketing spending)
How Has Our US Social Network Ad Spending Forecast Changed for Video vs. Nonvideo Formats? (billions, 2023)US Social Network Video Ad Spending, 2019-2024 (billions, % change, and % of social network ad revenues)
US Social Network Video Ad Spending Share, by Platform, 2019-2024 (% of total social network video ad spending)US Twitter Video Ad Revenues, 2019-2024 (billions, % change, and % of total Twitter ad revenues)
Average Time Spent per Day by US Adult Users on Select Social Media Platforms, 2023 (minutes)

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Download
Report
The One-Pager
Share
Table of Contents
Executive Summary
Social media will be the channel hit hardest by the digital advertising downturn.
Social video ad budgets will weather the storm better than their nonvideo counterparts.
Video now accounts for over half of all social network ad revenues.
Meta still commands the largest share of the market, but its dominance is waning.
As ad revenues falter, Meta’s growth strategy is all in on video.
Snapchat’s growth rivals the giants.
Twitter weighs down social video as it struggles to keep its head above water.
TikTok’s meteoric growth is cooling, but it’s still the envy of competitors.
YouTube is taking on social networks and streaming platforms in time spent—and ad revenues.
While advertisers can repurpose content across platforms, they shouldn’t.
Video ads will be at the center of social commerce initiatives as platforms battle it out for market share.
Creator-produced video is becoming a bigger piece of the paid social puzzle.
Revenue sharing models signal who will win with creators—and ultimately marketers—long term.
Social video advertisers have three big opportunities.
Sources
Media Gallery
About This Report
Facing signal loss and challenging macroeconomic conditions, advertisers are pumping the brakes on social network ad spending. But social video is shining through the gloom.
Topics
Social Media Ad Spending
Video Advertising
US
Table of Contents
Executive Summary
Social media will be the channel hit hardest by the digital advertising downturn.
Social video ad budgets will weather the storm better than their nonvideo counterparts.
Video now accounts for over half of all social network ad revenues.
Meta still commands the largest share of the market, but its dominance is waning.
As ad revenues falter, Meta’s growth strategy is all in on video.
Snapchat’s growth rivals the giants.
Twitter weighs down social video as it struggles to keep its head above water.
TikTok’s meteoric growth is cooling, but it’s still the envy of competitors.
YouTube is taking on social networks and streaming platforms in time spent—and ad revenues.
While advertisers can repurpose content across platforms, they shouldn’t.
Video ads will be at the center of social commerce initiatives as platforms battle it out for market share.
Creator-produced video is becoming a bigger piece of the paid social puzzle.
Revenue sharing models signal who will win with creators—and ultimately marketers—long term.
Social video advertisers have three big opportunities.
Sources
Media Gallery
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authors

Evelyn Mitchell-Wolf

Contributors

Jasmine Enberg
Principal Analyst
Jennifer Jhun
Research Director, International and Special Projects
Natalie McGranahan
Senior Researcher and Taxonomy Manager
Paul Verna
Principal Analyst
Debra Aho Williamson
Principal Analyst