- A new study into online advertising in the UK has revealed competitors' spending levels on the internet for the first time.
The AdWatch survey, carried out by new-media research house Fletcher Research, claims that, at average prices, the current online advertising inventory is worth more than £9.5m per month.
At 0.9 per cent of the UK advertising market, this is higher than the value of cinema advertising in the UK -- but only 14% of this online inventory is sold. Real expenditure is currently running at about £1.4m per month, or about 0.1 per cent of the UK advertising market.
However, Fletcher is expecting the introduction of digital TV to prove a real boost for the online advertising marketing in the UK. It estimates that online advertising will be worth £479m per year by 2002.
There are around 250 online advertisers in the UK, but only about 20 companies are using the web as a strategic marketing tool, according to the research. Two-thirds are advertising on only one site.
Of the top advertisers on traditional media, only BT and Ford are using the web as a dedicated marketing channel. The computing and financial services sectors account for over half of UK internet advertising expenditure.
Computing companies account for 34 per cent of all UK web advertising, financial services for 23 per cent, and the travel sector is third with 12 per cent. No other sector spends more than £100,000 per month.
William Reeve, head of Fletcher Research's Internet Practice, said: "Until now, research on UK internet advertising has consisted of little more than top line growth estimates for the industry as a whole. Fletcher's work highlights, for the first time, the companies and sectors that are driving the growth of UK advertising, which puts us in a uniquely strong position to explain the likely trends as the industry matures."
He added: "The pattern is clear. Today, internet advertising is a niche market, used mainly by computer and internet companies, and some segments that are suited to the wealthy male online audience, such as sports news and personal finance for high fliers. But as the web matures and starts entering more British households, consumer advertisers will no longer be able to ignore its power."