Internet Advertising Revenue to Exceed $21 Billion

Riding waves of quarterly growth, Internet advertising revenues for 2007 likely surpassed $21 billion, smashing the 2006 figure by miles, according to a new report from the Interactive Advertising Bureau (IAB).

The IAB’s Internet Advertising Revenue Report, a survey conducted independently by PricewaterhouseCoopers, is released in full twice a year, to coincide with the collection of half-year and full-year data. At the end of the first and third quarters, the IAB releases via press release estimated, top-line reports. The results reported are considered the most accurate measurement of Internet/online advertising revenues since the data is compiled directly from information supplied by companies selling advertising online. All-inclusive, the report includes data reflecting online advertising revenues from Web sites, commercial online services, Email providers, as well as other companies selling online advertising.” - Interactive Advertising Bureau


The report estimates Internet advertising revenue increased by 25 percent last year compared to 2006, a decline in growth rate compared to prior years. While the 2006 revenue figure of $16.9 billion was a record, 2007’s revenue far surpassed that figure. The IAB is estimating that companies spent $21.1 billion on Internet advertising last year. In the final quarter of the year, those companies spent over about $5.9 billion on online ads, the largest quarterly number ever reported by the IAB, a 13% increase over the third quarter of 2007.

 

The $5.9 billion figure represents an increase of 24 percent over the fourth quarter of 2006, according to the IAB. The IAB also noted that Internet ad revenues for the each of the four financial quarters of 2007 were all record breakers. In short that means the $21.1 billion year for Internet advertising is the culmination of consecutive record quarters throughout 2007.” In a statement IAB president and CEO Randall Rothenberg claimed, as we all already knew that the revenue growth is due to the fact that “there is no media as measurable as interactive,” and added that Internet companies are attractive to consumers and advertisers because “they provide products and services at the precise moment a consumer desires them.”

What does this mean for Search Marketers?

What does this mean for advertisers?

I will post an article next week that answers these questions and gives my predictions for 2008.