UK Internet Advertising Records 41.3% Year On Year Growth
New figures from the Internet Advertising Bureau (IAB) show that UK internet advertising has recorded above-expectation 41.3% year on year growth in the first half of 2007.
This takes the sector to a half-year high of £1,334.3 million – compared to £917.2 million a year ago – lifting online advertising’s market share to 14.7%.
The results of the biannual internet advertising spend study commissioned by the IAB in association with PricewaterhouseCoopers (PwC) and the World Advertising Research Centre (WARC), indicate that online advertising expenditure could reach a new high of £2.75 billion by the end of 2007.
The total UK advertising market grew by 3.1% during the first half of the year to £9.1 billion. However, the IAB says that without online’s contribution, UK media expenditure would have fallen by 1.9% (or £147 million).
The new results also see online overtake the size of the direct mail sector, which has a market share of 11.8%.
The study shows that all major online ad formats have surpassed expectations, with classified advertising the latest online success story, growing by 72% year on year to £277.7 million with a share of 20.8% of all internet advertising spend.
Internet display advertising (including banners, skyscrapers and rich media formats) climbed 33% to £287 million and a share of 21.5%.
Paid-for search (search engine listings that advertisers pay for when a consumer clicks through to their site) was 44% up year-on-year to £762.3 million – a share of 57.1% of the online total. Growth is attributed to at least half of all ecommerce transactions (£32 billion in 2006) starting with a search.
The top five categories remain the same as in 2006 but automotive has overtaken finance with a 12.5% share.
Recruitment leads with 24.7% of share up 5.3 points with finance down 3.9 points to 11.7%. Consumer goods made steady progress, increasing by 0.7 points to 5.3%, while retail remained static at around 3.1% of all online advertising spend.
Guy Phillipson, chief executive of the IAB, said: “The online market is developing at an astounding rate and once again we see exceptional growth and a significant increase in market share. 90% of internet users are on broadband now and nearly 40% are using wireless. We’re also seeing women and the over 50s spending far more time online, which makes the internet a very attractive medium to a broader set of advertisers.
“Importantly, marketers have a much better understanding of how online works and how to measure the effects of brand advertising as well as direct response. With other disciplines such as web TV, mobile and in-game advertising on the rise too, the opportunities in digital are limitless.”
A new forecast from ZenithOptimedia predicts that between 2006 and 2009, global internet adspend will grow 85% and raise its market share from 6.1% to 9.5%.
Meanwhile, eMarketer has predicted that for the first time, online advertising will surpass radio advertising spending in the US.
IAB: 020 8683 955 www.iabuk.net PricewaterhouseCoopers: www.pwc.com