Social Media Ads Go ‘Native,’ Will Hit $9.2b by 2016

BIA/Kelsey report predicts the market will double

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Spend on paid social media advertising will increase from $4.6 billion this year to $9.2 billion in 2016, according to a report set for release today from BIA/Kelsey. Particularly interesting is the researcher's prediction that "native" ads running on social media sites—contextual promotions that are baked into sites either via news feeds (e.g., Promoted Tweets) or in a more customized fashion—will total $1.53 billion this year while growing to $3.85 billion in 2016.

During that time, BIA/Kelsey prognosticates, social display ads will grow slightly slower, lifting from $3 billion to $5.4 billion. It's the first time the 25-year-old company has broken out social native versus social display spend.

Local social advertising will total $1.1 billion this year, BIA/Kelsey reports, compared to $3.47 billion in national spend. By 2016, the Chantilly, Va.-based firm predicts, local social will nearly triple, to $2.95 billion, while national will nearly double to $6.26 billion.

Desktop-based social ads will account for $4 billion this year while reaching $7.7 billion in 2016, BIA/Kelsey projects. Mobile-based social ads will total just over a half billion dollars this year before reaching $1.47 billion in 2016.

In other words, expect the temperature of the already heated debate about whether social ads work to increase. And expect platforms and vendors to scramble for the dollars. Possible beneficiaries include the obvious in Facebook and Twitter, but also could entail emerging social platforms like Tumblr, Pinterest, Foursquare and Reddit.

Meanwhile, per BIA/Kelsey, general local media spend will grow from $134.6 billion this year to $147.1 billion by 2016.

@Chris_Heine Christopher Heine is a New York-based editor and writer.