2007 Online Ad Spend

Posted by Kevin on Feb 12th, 2008 | 0 comments home title

Online advertising grew 27% last year, making it a sector unlikely to be affected even if the U.S. economy capsizes this year. IDC analyst Karsten Weide said businesses affected by the slowing U.S. economy will slash other advertising budgets before paring their online campaigns. Internet ad spending totaled $7.3 billion for the fourth-quarter of 2007, about 28% more than the same period in 2006. IDC also says Google remained the big dog, snagging 23.7% of the online ad revenue market. Yahoo came in a distant second with 11.4%, followed by Microsoft’s 5.6%, AOL’s 5.2%, Fox Interactive Media at 3% and InterActive Corp. (IAC) with 1.5%.

For those who fear a coming recession and a repeat of the carnage that came seven years ago, when the so-called dot-com boom went bust, Weide has good news. “Everybody is looking back to the last recession which coincided with the crash of Web 1.0,” he said. “Back then, of course, online advertising decreased in real terms. Spending went down in absolute terms,” he said. IDC doesn’t expect that scenario to happen this time. Why? “Back then a lot of advertisers still saw online advertising as experimental and that’s not the case anymore. It’s a well accepted means of advertising now and in fact many advertisers say Internet advertising is more effective than other forms.”