What marketers need to know from Mary Meeker’s 2019 Internet Trends report

Dive Brief:

  • There are 3.8 billion internet users globally, marking the first time that more than half of the world’s population is online, according to Mary Meeker’s 2019 Internet Trends report, which was first shared at Recode’s Code Conference on Tuesday. That figure, representing 6% year-over-year (YOY) growth, is solid but slowing, the 333-slide presentation by the Bond Capital general partner said, indicating broader disruptions hitting the online ecosystem.   [1]
  • Internet advertising is seeing “solid” growth and a “healthy” pace for innovation, but the report cautions that, in some areas, customer acquisition costs (CACs) might be “rising to unsustainable levels.” CACs are rising especially sharply in highly competitive sectors like mobile finance apps. Gains made in programmatic display advertising versus direct buying models continued to have a negative impact on pricing, Meeker’s report found. Two other bellwethers of digital health, global smartphone shipments and e-commerce growth rates, saw -4% YOY growth and 0% YOY growth, respectively — though physical retail sales growth still pales in comparison to online. 
  • The influx of data privacy oversights, from laws like the GDPR to Apple’s iOS enforcing stricter rules, are impacting ad targeting and affecting growth. Quarterly internet advertising revenue among the leading platforms in the U.S. has decelerated. Meanwhile, smaller digital advertising players are gaining market share: Amazon, Twitter, Snap and Pinterest collectively experienced more than 2.6 times growth in U.S.-based revenue since Q1 2017.

Dive Insight:

Meeker’s closely-watched annual trends report this year underpins some tectonic shifts hitting the digital advertising economy as growth begins to slow or decelerate in key areas and heavyweight platforms, like Google and Facebook, see their dominance tested amid an influx of competitors and new regulatory hurdles. The report captures just how fast private, encrypted messaging is gaining traction as a response to data privacy scrutiny. Eighty-seven percent of global web traffic was encrypted in Q1 2019 versus 53% three years ago, as noted in Fast Company[4]. Significantly, Facebook in March announced it would pivot its app network[5] of Facebook, WhatsApp and Instagram in this direction.[2][3] 

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