Internet advertising up on 2000

Advertisers showed their faith in internet advertising during 2001 by spending £165.7 million on the medium, up £11 million on 2000.

Research from the Interactive Advertising Bureau and PricewaterhouseCoopers shows that, despite the downturn in overall adspend, advertisers increased spending online. Most of the spend was in the first part of the year, but the IAB is convinced that signs are good for continued growth, and claims the "bottoming out" is over for the online ad market.

Peak spending was seen in the last quarter of 2000, when figures reached just under £50 million for the period. Although this has fallen steadily since, the new figures marked the first increase for a year.

The IAB chairman and chief executive, Danny Meadows-Klue, said media owners and advertisers were finding it hard to ignore the power of online marketing activity as the number of consumers using the internet continued to soar and the quality of online ads increased through technological advances. Banner ads still made up 52 per cent of the format share in 2001, a decline of 25 per cent from 2000, but site sponsorship took a 27 per cent share, up from 4 per cent in 2000.

"What sets this aside from all other data in the industry is that it records the actual spend as recorded by the finance departments of internet media companies. This is the accurate gauge of the sector's performance and, while the rest of the ad industry contracted last year, online grew healthily," Meadows-Klue said.

"The majority of the gains were in the first half of the year, but in general, online's performance followed the advertising sector as a whole and probably matched press display and television most closely," he added.

The director-general of the Advertising Association, Andrew Brown, said: "Across the whole advertising market in 2001 we have experienced some tough times. Although smart marketers spend their way through a recession to grow their market share, we saw some nervous behaviour which led to the overall contraction of the sector by 4.3 per cent in real terms by the end of the year."

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