Evidence of this was revealed last week by the Internet Advertising Bureau, which predicted online adspend would reach £1 billion by the end of this year. The figures are not totally conclusive, because in the same week ZenithOptimedia estimated UK online spend in 2005 to be £655 million.
Nevertheless, even Zenith's less generous estimates see the industry closing in on the £1 billion mark by 2010.
It seems that much of the growth is coming from large advertisers. In the US, it's said that some client companies are approaching their media agencies with such large online budgets that the agencies are finding it almost impossible to spend them. In the UK, it's the likes of Unilever and COI that are showing significant interest in the medium. COI's online spend, for instance, has more than doubled from £3 million (2003/2004) to £8.2 million (2004/2005).
This is fantastic news for the online agency community. To date, few advertisers have been willing to hire digital agencies on a retained basis.
Much of the work has therefore been project-based. Today you will find that the best agencies in the sector - glue London, Dare, Agency Republic and Agency.com among them - are turning down project-based work because they are too busy working on accounts with more secure remuneration attached to them. It's reaching the point that if clients want the best agencies to work on their business, they're going to have to offer them retained contracts.
Campaign held its first Digital Awards last week. The winning work was strong, but overall there's room for improvement in online creative. Digital agencies, starting to feel confident of their futures once again, now need to stand by great creative work and use it as a building block for growth.