Online Advertising Hits $31.7 Billion In 2011

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Internet ad spending grew 22% in 2011 to $31.7 billion, according to the latest data from the Interactive Advertising Bureau and PricewaterhouseCoopers. That growth rate tops last year’s 14.5%, indicating that digital advertising continues to ramp up after a recession-induced setback in 2009.

For the fourth quarter of 2011, online ad spending hit nearly $9 billion -- up 20.4% from a year ago, and 14.7% from the third quarter.

The IAB said mobile advertising -- which it began tracking in 2010 for the first time -- was the fastest-growing category in 2011, jumping 149% to $1.6 billion from $641 million in 2010. Mobile also doubled from 2.5% to 5% of total online ad dollars this year.

Digital video advertising -- which the IAB includes as part of display advertising -- saw strong growth as well, rising 29% from $1.4 billion to $1.8 billion. Overall, display spending rose 15% in 2011 from $9.6 billion to $11.1 billion.

Search advertising enjoyed even bigger gains, growing 27% from $11.7 billion to $14.8 billion. It continued to make up the largest proportion of online ad spend: at 46.5%, up from 44.8% in 2010. That increase came at the expense of display, which declined from 37% in 2010 to 34.8% last year.

Retail advertisers remains the largest category of Internet ad spending, accounting for 22% in 2011, or $7.1 billion, up slightly from 21% ($5.5 billion). Financial services accounted for 13% ($4.1 billion), telecom, 12% ($3.9 billion), automotive, 11% ($2.9 billion), leisure travel, 8% ($2.4 billion), and computing 8% ($2.7 billion). Those proportions all held fairly steady through 2011, varying only by a percentage point here and there.

Fueled by search and mobile spending, performance-based advertising gained ground in 2011, accounting for nearly 65% of total online ad dollars, up from 62% in 2010. CPM-based advertising dipped slightly from 33% to 31.3%, while dollars going to hybrid-priced models also declined from 4.8% to 4.2%.

By its reckoning, the IAB said the $31.7 billion in Internet advertising in 2011 eclipsed the $31 billion in cable TV advertising last year, making the category second only to broadcast TV ($38.5 billion). “Pushing past the $30 billion barrier, the interactive advertising industry confirms its central place in media," said IAB President and CEO Randall Rothenberg, in announcing the 2011 figures Wednesday.

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1 comment about "Online Advertising Hits $31.7 Billion In 2011".
  1. Kevin Bullard from ILFUSION Creative , April 19, 2012 at 11:47 a.m.
    Hmm. I am beginning to suspect that this internets advertising thing may just make it!