Online ad spend nearly £3bn in 2007

April 9, 2008
by Latitude

Quantifying the shifts taking place in marketing, media and distribution of attention is always a happy endeavour for those working in online marketing – and especially search. So we (and you) love our metrics around here. The latest numbers paint a satisfyingly rosy picture, as ever.

First, the IAB (Internet Advertising Bureau) has released its latest findings into online ad spend, derived from research conducted in conjunction with PricewaterhouseCoopers and the World Advertising Research Centre. From Luan Goldie’s report for NMA:

Internet ad spend topped £2.8bn in 2007, making online the largest ad market…Online spend continued to grow at a rate of 38% year-on-year in 2007, with a market share of 15.3%, up from 11.4% in 2006. The IAB claims the rate of growth for online is nine times faster than the entire ad market.

The continued growth was fuelled largely by display, search and classified, which experience a 31% year-on-year increase.

First, the IAB (Internet Advertising Bureau) has released its latest findings into online ad spend, derived from research conducted in conjunction with PricewaterhouseCoopers and the World Advertising Research Centre. From Luan Goldie’s report for NMA:

Internet ad spend topped £2.8bn in 2007, making online the largest ad market…Online spend continued to grow at a rate of 38% year-on-year in 2007, with a market share of 15.3%, up from 11.4% in 2006. The IAB claims the rate of growth for online is nine times faster than the entire ad market.

The continued growth was fuelled largely by display, search and classified, which experience a 31% year-on-year increase.

Search itself saw a 39 per cent boom. The researchers also predicted that online may well outpace TV spend by the end of next year if this sort of growth continues.

The Association of Online Publishers (AOP) has also released some encouraging numbers in its annual survey. Online publishers saw a 52 per cent rise in digital revenues, including a 33 per cent increase in ad revenue. The Guardian‘s Jemima Kiss reports that nearly 80% of publishers remain confident that the online advertising model is sustainable. The AOP’s director, Ruth Brownlee, isn’t too worried about the impact of an economic downturn:

[She] is confident that any downturn will be outweighed by the trend for consumers moving both their time and money online. Nobody feels they have to batten down the hatches, she says. “People are preparing themselves for a recession, but if you look at their forecasting and performance, they are still utterly bullish and confident. That is indicative of a maturing market.”

AOP Chair Simon Waldman adds some cogent points on his personal blog:

OK – anyone with a memory better than a goldfish will realise this is now the fifth or sixth year that we’ve seen growth on this scale. Both growth figures are down from last year (the IAB was 41%, the AOP 63%), but even so – this is a striking run of growth for any medium.

…The other thing is that all of this is only monitoring paid-for media. If you looked at the amount that advertisers are spending online – not to mention the amount of their effort and imagination it is taking up – the story would be even more impressive.