In the last couple of years, digital marketing has grown from a small slice of the marketing mix to something close to a household name. As an industry, we’ve been through a lot. We went from primarily focusing on text ads to a near-equal split between text and display ads, with more and more marketers jumping on the digital marketing bandwagon. Then came the biggest shift of all: the rise of mobile marketing and mobile advertising as a whole.

Let’s dive into how big online marketing actually is.

The Growth Of Online Marketing

Looking at ad revenue alone isn’t going to give you a clear picture of the size of the online marketing industry. One of the best metrics for assessing market size is the CAGR (Compound Annual Growth Rate) of a marketer’s total revenue over a three-year period. Compound annual growth rates are considered to be a good indicator of a market’s size because they factor in both year-to-year growth and the existing state of the market at the start of the period being examined.

According to HubSpot Blogs research, the average CAGR for B2B (business-to-business) marketing agencies is a healthy 17%. That’s three years of growth from roughly $20,000 to $35,000 per month, with most agencies crossing the $30,000-per-month threshold.

For comparison, the average CAGR for marketing agencies in the utilities sector is 4%. The average CAGR for financial services agencies is 2% and 2% for consumer packaged goods and retail industries, respectively.

Looking at the above figures, it’s apparent that B2B marketing agencies are experiencing much faster growth than their counterparts in other industries. In fact, the only other market sector where you see comparable growth is health care (average CAGR of 15%), which is likely due to the fact that so much of marketers’ time is now spent on digital marketing efforts.

The Rise Of Mobile Marketing

Mobile marketing and mobile advertising are terms used interchangeably, but they’re not the same. With mobile marketing, you’re targeting consumers on their mobile phones. With mobile advertising, you’re presenting ads to users on a mobile device, whether or not they’re on the web. In either case, the goal is the same: to get someone to click on an ad or a link to learn more about a product or service.

According to HubSpot Blogs’ research, the mobile marketing industry as a whole is expected to grow 19% year over year, which would make it the second-largest segment of the digital marketing industry (after SEO/SEM).

What is responsible for the growth in this area? Most notably, the rise of mobile smartphones and the consumer’s increasing affinity for consuming content on the go. In other words, as more and more people want to use their smartphones to access the web, marketers are taking advantage of this by creating mobile-optimized websites and mobile apps.

The mobile marketing industry includes all of the parts of digital marketing plus mobile ad technology: SEO, social media, email marketing, and paid advertising. And it’s not just about generating leads. According to HubSpot Blogs’ research, 77% of respondents say their primary purpose for creating a mobile ad campaign is to drive sales.

Let’s dive into the figures a little deeper.

Mobile Advertising Revenue Trends

The following chart from Statista highlights the future of mobile advertising. The analyst firm surveyed 2,000 digital marketers from across the globe and asked them about their involvement in various aspects of digital marketing, including mobile advertising. Here are some of the highlights:

• 64% of survey respondents say they will increase their investment in mobile advertising in the next year
• 55% say they will increase their involvement with mobile marketers
• 76% of digital marketers say their job is to promote products/services on social media
• 42% of digital marketers say their job is to drive traffic to websites
• 80% of digital marketers say they use various digital marketing tools (e.g., social media, SEO, email marketing, and paid advertising) to reach their target audience

These numbers should give you a clear picture of where the digital marketing world is heading. We’re moving towards a world where people get their news and entertainment on their phones, where marketing messages are crafted to suit the needs of digital consumers, and where paid advertising is the preferred method of gaining brand recognition.

The Growth Of Digital Marketing’s Sub-segments

Looking at growth rates for sub-segments of the digital marketing industry can give you an idea of how much the market as a whole is expanding. As it turns out, digital marketing as a whole is a large and growing market; however, there are various sub-segments within it that are experiencing remarkable growth.

According to HubSpot Blogs’ research, these sub-segments include:

SEO (search engine optimization)

While SEO is often thought of as a standalone form of marketing, it’s a really important part of the overall digital marketing strategy. When done right, SEO can help drive a ton of traffic to your website, which in turn, can lead to an increase in sales.

SEO is all about getting free, quality traffic from the major search engines like Google, Bing, and Yahoo. You’re trying to secure your website’s ranking on these search engines’ first pages (known as the “organic results”).

The following chart from Statista shows the projected growth of SEO over the next five years.

• 65% of respondents say they will increase their investment in SEO in the next year
• 54% say they will increase their involvement with SEO specialists
• 76% of SEO respondents say their job is to promote products/services on social media
• 57% of SEO respondents say their job is to drive traffic to websites
• 79% of SEO respondents say they use various digital marketing tools (e.g., social media, SEO, email marketing, and paid advertising) to reach their target audience

Email Marketing

Email marketing is another highly effective form of digital marketing. You’re probably already doing email marketing, whether you realize it or not. Just check your email for spam warnings and you’ll see how easy it is to get in the habit of pitching people on email marketing platforms, like HubSpot.

Like SEO, email marketing can help you drive traffic to your site. However, in addition to getting traffic, you can also use email marketing to nurture leads and turn them into paying customers. Once you have their attention with an email, you can use other platforms, like HubSpot, to engage with them further and grow your business.

The following chart from Statista shows the projected growth of email marketing over the next five years.

• 52% of respondents say they will increase their investment in email marketing in the next year
• 43% say they will increase their involvement with email marketers
• 81% of email marketers say their job is to promote products/services on social media
• 56% of email marketers say their job is to drive traffic to websites
• 90% of email marketers say they use various digital marketing tools (e.g., social media, SEO, email marketing, and paid advertising) to reach their target audience

Social Media Marketing

If you’re not yet doing social media marketing, you should be. As a form of digital marketing, social media marketing is all about getting people to like, share, and comment on your content.

The following chart from Statista highlights the projected growth of social media marketing over the next five years.

• 49% of respondents say they will increase their investment in social media marketing in the next year
• 39% say they will increase their involvement with social media marketers
• 73% of social media marketers say their job is to promote products/services on social media
• 52% of social media marketers say their job is to drive traffic to websites
• 90% of social media marketers say they use various digital marketing tools (e.g., social media, SEO, email marketing, and paid advertising) to reach their target audience