NEW YORK—One of the pandemic’s overarching effects was accelerated digital transformation across the economy and society. A steep increase in the amount of retail sales transacted digitally buoyed digital ad spending last year and boosted digital advertising’s long-term prospects, according to a recent report and forecast by eMarketer.

“Advertisers pulled back hard on spending in late Q1 and Q2 last year, and when they returned with updated messaging, they looked to ad channels that offered flexibility and accountability,” the firm’s report noted. “That meant a strong recovery for digital ad spending as traditional media faced steep spending drops.”

In 2021, eMarketer now forecasts that U.S. digital ad spending will increase 25.5 percent, the fastest growth rate since 2018, as the ad market and wider economy continue recovering from the pandemic. Total media ad spending will rebound 18 percent this year after a flat 2020, and this increase includes a 5.2 percent increase in traditional media ad spending, led by a partial recovery for TV, eMarketer said.

“Within digital media, performance-oriented channels including social network advertising and e-commerce channel advertising held up well during the pandemic and will continue growing rapidly,” the firm said. “Connected TV (CTV) advertising was also a beneficiary of pandemic trends, as linear TV decreased in importance and cord-cutting accelerated as more programmatic CTV inventory was becoming available than ever before.”

The key stat, though, according to eMarketer is that U.S. advertisers increased their spending on digital ads last year by almost 15 percent despite the pandemic—and growth will accelerate this year as digital surpasses two-thirds of the U.S. ad market.