Omdia: Social media advertising to command nearly half of global online ad revenue by 2030 as market reaches $640 billion
Omdia: Social media advertising to command nearly half of global online ad revenue by 2030 as market reaches $640 billion
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compound annual growth ratefinancial
The compound annual growth rate (CAGR) shows how much an investment or value has grown, on average, each year over a specific period. It considers the effect of growth that compounds or builds upon itself, similar to how interest accumulates in a savings account. Investors use CAGR to compare different investments’ long-term performance and to understand how steady or consistent their growth has been over time.
cagrfinancial
Compound Annual Growth Rate (CAGR) measures the average yearly growth of an investment, revenue, or other metric over a multi-year period as if it had grown at a steady rate each year. Think of it like the constant speed that would take you from the starting value to the ending value over the same time—useful because it smooths out ups and downs and lets investors compare different assets or performance periods on an even footing.
full-funnel solutionstechnical
Full-funnel solutions are marketing and sales strategies that cover every stage of a customer’s journey—from first learning about a product, to considering it, to buying and staying a customer—using coordinated tools and channels. Investors care because a coherent approach can lower the cost to acquire customers, improve conversion rates and increase lifetime value, making revenue more predictable and scalable; think of it as managing the whole pipeline instead of just one step.
self-serve platformstechnical
Digital services or websites that let customers complete tasks—like buying products, managing accounts, or setting up services—without interacting with a human representative. Think of them as automated self-checkout lanes online: they lower costs, speed up transactions and can scale quickly, so investors watch them for potential revenue growth, customer retention and operating efficiency impact on margins.
ai-driven targetingtechnical
AI-driven targeting uses artificial intelligence to analyze data and automatically identify the people or customer groups most likely to respond to an ad, product, or message, then directs marketing efforts toward them across channels. Think of it as a smart map that routes campaigns to the fastest paths to buyers. For investors, it matters because better targeting can boost sales and marketing efficiency but also changes cost structure, measurable returns and exposure to privacy or regulation risk.
recommendation algorithmstechnical
Recommendation algorithms are computer programs that sift through large amounts of data about users, assets and content to suggest stocks, news, or actions that match a person’s interests or past behavior. Like a helpful store clerk who remembers your tastes, they matter to investors because they shape what information and opportunities people see, influencing trading flows, market attention and the speed at which trends or risks spread.
walled gardentechnical
A walled garden is a closed digital system where a company controls which apps, content, data and payment methods can be used, creating a tightly managed customer environment. For investors, it matters because this control can boost recurring revenue and customer loyalty by making users stickier, but it also concentrates regulatory and competitive risk—like renting an apartment with private amenities that limit your choices but can be more convenient and profitable for the landlord.
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LONDON--(BUSINESS WIRE)--
Social media advertising revenue is projected to rise at a compound annual growth rate (CAGR) of 12% over the next five years, reaching $640 billion by the end of 2030, according to Omdia’s Social Media Advertising Market Landscape 2026 report, its first-ever research focusing exclusively on social media advertising.
Global social and non-social media advertising revenue and shares, $bn and %, 2020–30
During the same period, social media’s share of total online advertising is expected to increase by 10 percentage points, from 33% to 44%, making it one of the fastest-growing advertising segments alongside retail media.
Rising user engagement, advertisers' growing preference for full-funnel solutions, and the proliferation of self-serve platforms are key factors underpinning social media platforms’ sustained performance.
Social media advertising revenue is increasingly being driven by video formats such as Reels, TikTok, Shorts, and Stories. In full-year 2025, video accounted for 60% of total social media advertising revenue. Platforms are not only expanding their video advertising revenue but also capturing budgets historically directed toward other digital channels, including online publisher inventory and broadcasters' digital offerings. Over time, increases in high-value video ad load, improved commerce capabilities, and clearer segmentation between performance-driven and premium formats will drive additional revenue growth for social platforms.
Crucially, 90% of global social media advertising revenue is generated by just half a dozen apps, namely Facebook, Instagram, Douyin, YouTube, TikTok, and WeChat, highlighting the segment’s highly concentrated market structure. Meta effectively dominates through ownership of both Facebook and Instagram apps. Together, they accounted for 54% of the social media advertising revenue in 2025, rising to almost 70% when China is excluded.
“AI-driven targeting and recommendation algorithms are turbocharging the advantage of these big players,” said Kia Ling Teoh, Principal Analyst at Omdia. “These capabilities favor ‘walled garden’ platforms with deep user data and sophisticated computing infrastructure, locking out smaller players and funneling ad dollars to the top.”
However, maintaining this dominance will require a balanced approach to both monetization and user experience. Over-saturating feeds with ads can alienate users and undermine long-term engagement. Sustained growth will depend on balancing AI‑driven ad optimization with preserving the user experience.
About Omdia
Omdia, part of TechTarget, Inc. d/b/a Informa TechTarget (Nasdaq: TTGT), is a technology research and advisory group. Our deep knowledge of tech markets grounded in real conversations with industry leaders and hundreds of thousands of data points, make our market intelligence our clients’ strategic advantage. From R&D to ROI, we identify the greatest opportunities and move the industry forward.
