The digital advertising industry will continue to see strong growth driven by retail shift to online sales. Currently, only 18% of retail in the US is online which is very early on the S-curve. As retail continues to shift online, the importance of digital advertising will increase. The digital advertising industry is very concentrated; Google, Facebook, and Amazon have 27%, 22% and 9% of the industry respectively and even higher excluding China. Small and medium businesses are reliant on Google and Facebook advertising to convert sales and gain brand awareness. The digital nature of the industry allows companies to quantitatively see the benefits of their advertisements and allows digital advertisement companies to price discriminate raising margins based on supply and demand.

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