Sponsored-Content Spending Growing Faster Than Predicted

This week Ad Age reported that eMarketer revised their forecast for sponsored content spending upward. Previously, eMarketer had estimated that advertisers would spend $1.88 billion on sponsored content this year, a 22.1% increase from 2012, and that spending would reach $3.08 billion by 2017. However, the new forecast estimates $1.9 billion for this year and $3.2 billion by 2017.

The increase is driven by the desire to create more bespoke content for brands, which in turn increases ad rates since native advertising fetches higher prices. The rise of sponsored posts that mimic the editorial content about them is driven largely by what is referred to as "banner blindness." In order to offset the reduced demand for display ads, the publishers have turned to these sponsored posts.

Given our discussions in class, this really comes as no surprise. However, it was striking enough to warrant the lead headline in Ad Age Daily's newsletter. Again, it shows the need to advertisers to work ever harder to grab consumers' attention. We've become blind to display ads and can only be reached in more and more complex (and costly) ways.