An Increase in European Advertising

by Jan 30, 2001, 9:00 AM

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While online advertising spend fell slightly in key European markets in December 2000 from the previous month, Forrester Research B.V. predicts a 70% increase in European outlays on online advertising. Forrester expects online ad spending to reach 1.2 billion euros, up from 690 million euros in 2000.

"The first half of 2001 will be relatively quiet, but by the second half, growth in spending on online advertising will pick up," commented Marc Cohen, European AdWatch Manager. "Although dot-coms are tightening their belts, traditional advertisers are expected to step further into the market.

"In general there is this virtuous circle going on. More people are going online, more people are getting comfortable with spending money online and more companies are getting money via online channels, so they can spend more on online marketing."

According to Forrester's Internet AdWatch Spending Monitor, in December last year online ad spend across all of Europe's major markets totaled 38.8 million euros. Spending on online advertising in the UK fell to 17.3 million euros, from 17.7 million euros in November, while in Germany spending fell to 12.6 million euros, from 12.8 million euros the previous month. In France, a less mature market for Internet advertising, spending rose slightly, to 8.6 million euros, from 8.3 million euros in November.

The consumer-goods category saw the most spending on online advertising in December, rising to 25% of the total spent in the United Kingdom and 24% in Germany. In Germany, TooJoo AG, an online gift shop, spent the most on online advertising at 381,000 euros. In Britain, Virgin Group led with 349,000 euros, and in France, Banque Nationale de Paris was the biggest spender, with a 194,000-euro outlay. Banque Nationale de Paris maintained its rank after spending the most on online advertising the previous month, while in the U.K. the Royal Bank of Scotland Group PLC had been in first place in November, and Germany's top spender was Primus Software AG.

"In contrast to the lower overall online adverting spending, November and December 2000 showed increases in the number of companies advertising, but were getting lower rates for each ad purchased," Cohen added. "Also, many new advertisers were spending small amounts as they were making first-time forays on to the Internet over Christmas.

"Traditional spending by media and entertainment companies has been the biggest category, particularly over the summer months. Banks and information technology companies were prominent among the biggest spenders in online advertising, while more retailers were online targeting Christmas shoppers."

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