Q1 Online advertising expenditure increases 19 percent year on year
Display advertising is hot property in the online advertising world once more, with the category recording its highest year on year growth since 2008. The results, which were announced today by IAB Australia in its Online Advertising Expenditure Report (OAER) compiled by PricewaterhouseCoopers (PwC), show total online advertising increased 19 percent year on year, with revenues for Q1 ending 31st March 2012 reaching $713 million, an increase of $111.9 million from Q1 2011.
The report comes as IAB Australia announced that in 2012, it will be releasing online video measurement data, delivering localised global standards, guidelines and best practices, along with new research, cases studies and new advertising formats to accelerate the shift in brand advertising online.
Paul Fisher, CEO of IAB Australia commented: “The continued growth of online reflects the strengthening confidence of marketers and agencies that online is their medium of choice. In this challenging economic environment they look to online to provide measurability, reach, frequency, brand and direct response messaging – and they aren’t being disappointed.
“There is no doubt that online advertising in on track to surpass $3billion and 20 percent share of all advertising this calendar year, and it’s quite possible that we’ll reach that milestone this financial year thanks to increased consumer confidence sparked by further interest rate cuts which we believe will support continued growth in online advertising in key sectors,” said Fisher. “We’ll be working hard this year, as always to ensure that advertisers and agencies alike are armed with all the information, insights and tools they need to increase online in their advertising mix.”
All three categories reported strong year on year growth, with display advertising recording 18 percent growth to account for 21.6 percent of total revenue in Q1 2012, while classifieds grew 13 percent year on year to account for 22.9 percent in Q1 2012 and search and directories grew 21.4 percent year on year to account for 55.5 percent of the total online advertising expenditure for the three months ended 31st March 2012.
Search and directories continues to dominate the online advertising sector overall, growing its share to $395.7 million, with Directories growing at a faster rate than search during the period.
Classifieds continue to migrate from other media to reach $165.3 million for the quarter, fuelled by strong growth in the real estate, automotive and recruitment sectors.
Display reached 18 percent year on year growth. Within the category, the FMCG sector posted significant year on year growth as brands looked to reach, engage and influence grocery buyers online. Video also reported strong year on year growth to reach $11.6m for Q1 2012. CPM based pricing continued as the dominant expenditure type with 74 per cent of advertising expenditure and 26 per cent on a Direct Response basis.
“The retail and government sector online spend continues to flat-line which is surprising considering both are facing tough marketing and communications conditions. There is a real opportunity for these sectors to invest their advertising budgets online where they will reach, engage and influence their audiences most effectively and we’ll be working hard through this year to help them understand the potential that online offers them,” said Fisher.
About the Interactive Advertising Bureau
The Interactive Advertising Bureau (IAB) Limited is the peak trade association for online advertising in Australia and was incorporated in July 2010. As one of over 40 IAB offices globally, and with a rapidly growing membership, IAB Australia’s principal objective is to increase the share of advertising and marketing dollars that interactive media captures in the marketplace.
IAB Australia’s board includes representatives of Fairfax Media, News Digital Media, REA Group, Network Ten, Yahoo!7, APN News & Media, ninemsn, Carsales.com, Telstra, TressCox Lawyers and AIMIA. It has four objectives:
- To develop, coordinate and promote industry standards and guidelines that make interactive advertising a simpler and more attractive medium for agencies, advertisers and marketers
- To prove and promote the effectiveness of interactive advertising to advertisers, agencies, marketers, and the press
- To be the primary advocate for the interactive marketing and advertising industry
- To expand the breadth and depth of IAB membership while increasing direct value to members