Online Advertising shoots Ahead of IAB Target

Online advertising reached record levels in the first half of 2003, recording a spend of £151.6million and a market share of 2%, according to figures published by the Interactive Advertising Bureau with PricewaterhouseCoopers LLP.

The half year audit values the internet market at £266.5 million for the twelve months between 1 July 2002 to 31 June 2003. More importantly, as the industry is predicting a record breaking online retailing boom during Q4 2003, the IAB is confident total online advertising spend for 2003 will reach £300m for the first time – more than £100m up on 2002.

The IAB/PWC audit has run since 1997 and is the official barometer for online media spend. Comparing total half-year ad spend figures year on year, the growth rate was 85.3% (first half 2003 compared to first half of 2002). The IAB believes this is due to a realisation by mainstream marketers that the internet can play a powerful brand building role additional to being a direct selling medium.

The IAB is delighted at discovering that their goal of accelerating the sector to achieve a market share target of 2% of UK ad spend by autumn 2004 had been reached early. At the time of planning, online was worth just over 1%. Now online advertising, as a proportion of all advertising spend, is about double the size of cinema and already about half the size of radio, based on their historic performances.

Key drivers behind this recent growth include the relentless growth of internet audiences themselves and the ever-extending role the internet plays in consumer’s daily lives.

The rapid growth in online advertising is in stark contrast to the advertising industry as a whole. According to the Advertising Association, total advertising expenditure fell by 1.5% for Q1 2003 and by 1.8% for Q2 2003 compared to the same period a year earlier (figures in real terms).

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