Article by Nicole Perrin
Source: www.emarketer.com, November 2020
Prior to the pandemic, we expected search ad spending in the US to grow by 14.4% this year as part of a trend of gradually slowing growth from 2018 through the end of our forecast period in 2024. When the pandemic upended that expectation, we revised our outlook in anticipation of a virtual halt to travel industry search spending. But as more information has come in throughout the summer and early fall about the pace of consumer ecommerce spending, we have again updated our estimates of search ad spending in 2020—this time, in a positive direction.
We now forecast 5.9% growth in search ad spending this year. But the changes are farther-reaching than that. As the pandemic is permanently shifting more retail sales to digital channels, it’s also driving more search advertising by digital merchants.
The overall level of economic disruption means our current forecast for search spending in 2020 and 2021 is lower than we predicted before the pandemic. But our new forecast for search actually exceeds our pre-pandemic expectations for 2022. We now expect advertisers will spend $99.22 billion on search in 2024—up from the $91.32 billion we expected at the beginning of this year.
Most of that spending will go to placements on mobile devices, with the share growing to about two-thirds by 2024. Desktop and laptop search ad spending will barely go up this year due largely to a decline in big-ticket, high-consideration searches for travel services as a result of the pandemic. Categories that are holding up well in the pandemic, like consumer packaged goods (CPG), are more likely to be searched and shopped for on mobile devices.