From today's New York Times Media & Marketing Section:
Internet advertising rose in 2008, according to a report
released Monday, but the growth is starting to flatten.
"The economy has had a significant impact on the short-term growth of the Internet advertising market," David Silverman, a partner at PricewaterhouseCoopers, which contributed to the report, said in a conference call.
Internet advertising grew to $23.4 billion in 2008, an increase of 10.6 percent from 2007, according to the Internet Advertising Revenue Report from the Interactive Advertising Bureau, a trade group representing online advertisers, as well as PricewaterhouseCoopers.
That was the only category of advertising spending that grew in 2008 other than cable television, which rose 7.8 percent, according to Nielsen figures supplied for the report,
Over all, total non-Internet media revenue declined 2.4 percent in 2008 from 2007, according to Nielsen. Spending in network television declined 3.5 percent, in national magazines 7.6 percent and in local newspapers 7.8 percent.
Internet advertising rose in 2008, according to a report released Monday, but the growth is starting to flatten.
"The economy has had a significant impact on the short-term growth of the Internet advertising market," David Silverman, a partner at PricewaterhouseCoopers, which contributed to the report, said in a conference call.
Internet advertising grew to $23.4 billion in 2008, an increase of 10.6 percent from 2007, according to the Internet Advertising Revenue Report from the Interactive Advertising Bureau, a trade group representing online advertisers, as well as PricewaterhouseCoopers.
That was the only category of advertising spending that grew in 2008 other than cable television, which rose 7.8 percent, according to Nielsen figures supplied for the report,
Over all, total non-Internet media revenue declined 2.4 percent in 2008 from 2007, according to Nielsen. Spending in network television declined 3.5 percent, in national magazines 7.6 percent and in local newspapers 7.8 percent.
Though overall growth was strong relative to other mediums, Internet advertising did not have the large increases of recent years.
Internet revenue dipped in the first and second quarters for the first time in four years. And online advertising in 2008 had the lowest growth rate — 2.6 percent — from the fourth quarter compared with the period a year earlier.
As Mr. Silverman said, however, "it's one of the few things that actually grew in the fourth quarter 2008."
There were some interesting shifts within Internet advertising.
Digital video revenue more than doubled in 2008 versus 2007, growing to $734 million from $324 million. Advertisers were also more frequently using performance-based ads - where they pay only when someone clicks on the ad or buys something after seeing the ad. Performance-based ads made up 57 percent of all Internet advertising in 2008, according to the report, up from 51 percent in 2007. Ads that were paid for based on how frequently they were shown - called CPM-based pricing, for cost-per-thousand - fell to 39 percent, from 45 percent. And sponsorship advertising, where publishers create custom pages and advertisements for brands, was less popular this year than last: it fell to 1 percent of all fourth-quarter revenue in 2008, down from 3 percent in 2007.
Online advertising from consumer-packaged goods companies was a big growth area, rising to $1.5 billion in 2008, up from $925 million in 2007. That was significant, said Peter S. Fader, a professor of marketing at the Wharton School of the University of Pennsylvania who participated in the conference call.
That was "something that would have been unthinkable just a few years ago. People didn't think this would be the right space to be selling grocery-type products," he said. Now, "customers are becoming accustomed to seeing relatively mundane products advertised and promoted" on the Internet, he said.
Courtesy of www.nytimes.comLabels: marketing, Web Ads, web strategy