Online advertising expenditure in the US has increased by a greater than anticipated 15% in the final quarter of 2005, with a new study from Deutsche Bank and MediaPost attributing the boost to a marketing push through the holiday season.
According to the survey, 72% of media executives reported their clients spent more on internet advertising in the fourth quarter of 2005 compared to the third, with 55% seeing rises of more than 10%.
A fifth of those surveyed, however, said there was no change in online adspend, while 8% said expenditure declined.
Commenting on the findings, Jeetil Patel, senior analyst at Deutsche Bank said: “A 15% improvement in spending would suggest that things are better than expected at this point. It’s quite bullish for the industry as a whole.”
Meanwhile, in the UK, OPera Media predicts online advertising to continue the strong growth that it has seen recently, with the growth this year at 40% slowing to 35% next year. By 2010, the value of online advertising is projected to reach £2.3 billion, up from £912 million in 2005 (see UK Adspend To Hit £15 Billion By 2010).
Turning to paid search, the Deutsche Bank and MediaPost study shows 65% of media executives claiming paid search spend increased in Q4 compared to Q3 2005, while 25% reported no change and 10% saw spend drop.
Just under half of the respondents, 49% revealed spend to be up by between 1% and 10%, with 16% seeing a surge of more than 11%.
Paid search looks set to enjoy a strong 2006, with a recent report from Piper Jaffray forecasting the medium to generate more than $14 billion globally this year, seeing an increase of 41% from the estimated $10 billion that it made in 2005 (see Paid Search To Reach $14 Billion Worldwide In 2006).
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