Executive Summary

US digital ad spending has been growing at a double-digit rate for years—since the last recession, in fact. But the pandemic has changed all that, and we now expect just a 1.7% increase in US digital ad investment this year.

How much has the pandemic slowed digital ad spending?

Digital ad spending in the US will grow this year—but not much. Our previous expectation was for almost 17% growth, and now we expect 1.7% growth. Instead of an incremental $22 billion in advertiser spending going to digital, we now forecast just $2.2 billion in additional investments this year.

Which channels and formats are most affected by spending cuts?

Search spending will decline this year, despite its focus on performance—mostly because of the travel industry’s heavy reliance on the format. Display, meanwhile, will continue to rise, buoyed by video. But traditional media channels will be affected even more than the digital ones outlined in this report: TV, print and radio ad spending will all decline by double-digit rates this year.

What effect will the pandemic have on ad revenues at the Google-Facebook-Amazon triopoly?

For the first time since we have begun estimating ad revenues at Google, net US digital ad revenues at the company will actually decline in absolute terms. Facebook and Amazon will continue to grow, but at several depressed rates compared with earlier expectations. It adds up to a triopoly of about the same size in 2020 as 2019—but with a somewhat different internal breakdown.

WHAT’S IN THIS REPORT? This report highlights key changes in our Q2 2020 forecast of US digital ad spending driven by the coronavirus pandemic, including spending on major formats and platforms.

KEY STAT: US digital ad spending will inch up by less than 2% this year because of the economic dislocation caused by the coronavirus pandemic, though we expect robust growth to resume in 2021.