Technavio analysts forecast the global online classified ad platform marketto grow at a CAGR of over 8% during the forecast period, according to their latest report.
The research study covers the present scenario and growth prospects of the global online classified ad platformmarketfor 2016-2020. The report explains the market with a detailed forecast of its revenue in comparison with the global online advertising market.
With the growing reach of social networking websites, it has become a common practice for individuals to share the listing from classified platforms on social networking platforms. This increases the visibility of the listed products or services and helps advertisers generate higher traffic. However, it can also impact the revenue inflow of online classified ad platform providers, if the advertiser directly lists the product on social networking sites without tapping into classified ad platforms.
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Technavio media and entertainment analysts highlight the following four factors that are contributing to the growth of the global online classified ad platform market:
- Growth in mobile classified advertising
- Low cost of online advertising
- Rapidly declining print advertising
- Growing mobile device penetration
Growth in mobile classified advertising
The increasing penetration of smart devices worldwide has driven the growth of mobile classified advertising. The analysts from Technavio forecast the global smartphone sales to reach 1.8 billion units in 2016. With the increasing number of smartphone and tablet users worldwide, mobile advertising has become one of the fastest-growing segments of the global online advertising market, with a spending of more than USD 100 billion on mobile internet advertising across the globe. Mobile internet advertising can host a variety of advertisements such as mobile videos and in-app advertisements via different platforms, which increase their outreach.
Ujjwal Doshi, a lead media and entertainment services analyst at Technavio, says, "Other major factors expediting the growth of the mobile classified ad platform is the rapid growth of mobile internet advertising in developing economies such as China, India, Indonesia, and South Korea in APAC. With the continuous increase in adoption of smartphones and tablets, mobile classified ads will further deepen its roots in the global onlineadvertising market and attract higher investments in both technology and optimization
Low cost of online advertising
Advertising plays a major role in the penetration of new products in the market. It helps in increasing the awareness about products, creating an interest for products among buyers, and expanding the reach of products. It plays a crucial role in expanding the market for products in remote areas by using effective means of communication. Though advertising is one of the best ways to sell products, it remains a challenge for manufacturers with low budgets. Online advertising allows advertisers to advertise their products at minimal or no cost, unlike offline outdoor advertising platforms that are highly expensive. Online classified advertising helps manufacturers to list their products on normal or featured ad platforms and also allows them to count the number of views for their ads.
Rapidly declining print advertising
"The sales of newspapers and magazines declined drastically during the global recession of 2008. With newspaper companies facing budget constraints, subscription and renewals dwindled significantly. The corporate sector has reduced their print ad spending, which has further decreased the demand for newspapers and magazines," adds Ujjwal.
Print advertising is declining rapidly because of the increasing adoption of digital media advertising. Digital media advertising is cheaper and affordable for a large number of vendors and users. Digital media advertising has developed and is eating into print advertising's share. Print advertising is not able to compete with digital media advertising because of intense competition. For instance, classified ads, which are considered to be one of the major segments for revenue in print advertising, was not able to compete with Craigslist
Growing mobile device penetration
Digital media advertising on mobile devices is offering a better ROI compared with desktop computers since 2012. Technavio analysts expect this segment to experience high growth during the forecast period owing to the rising number of digital users globally. Personalized campaigns that are organized based on user information, search words, liked pages, and frequent interactions are the primary factors that increase the effectiveness of these ads. Digital ads are more effective when the user is connected with social media platforms. There are nearly 2.2 billion monthly active users on social media worldwide, of which at least 70% is on Facebook
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