Internet advertising expenditure in Europe is set to rise by almost 30% in the next 12 months and is predicted to be worth almost €4.7 billion by the end of 2009, according to a report by JupiterResearch.
The new report predicts the European internet advertising market to be worth €2.7 billion by the end of 2005, up from the 2004 total of €2.1 billion. In 2003, about €1.6 billion was spent on internet advertising in Europe.
With the advertisers accepting internet adverts as a standard component within the media mix, JupiterResearch has forecast that internet advertisement expenditure will increase in price throughout 2005.
According to internet research group Nielsen//NetRatings there are now 100 million home internet users in Europe, an increase of 12% year on year (see Broadband On The Rise In Europe). JupiterResearch attributes the predicted increase in European internet adspend to the continued expansion of the number of European consumers with internet access and increasing broadband penetration.
Julian Smith, author of the report and analyst at JupiterResearch said: “Recognition amongst marketers of the versatility of the internet as an advertising medium, alongside its accountability and the fact that it now reaches a mass, mainstream audience meant that in 2004 online finally took its place as a permanent fixture within the marketing mix.”
He added: “However, as more marketers come online in 2005 and competition intensifies to attract the attention of ever more experience and wary online consumers, so the cost of online marketing will increase.”
Smith also predicts that as the price of “online real estate” rises, marketers will be forced to offer increasingly sophisticated advertising campaigns, contributing to the price rise in terms of increased workload.
He said: “Marketers will need to look at new tactics and technologies to improve the targeting and impact of their campaigns in order to maintain positive return on their investment.”
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