Internet Ad Revenue Hits $42.8 Billion In 2013, Surpasses Broadcast TV

For the first time, marketers spent more to advertise on the Internet than they did for broadcast television in 2013. Investments in U.S. interactive advertising reached $42.8 billion in Internet advertising last year -- up 17% from 2012, per the IAB Internet Advertising Revenue report.

Randall Rothenberg, president and CEO of the IAB, said in a prepared statement that the news that interactive has outperformed broadcast television should come as no surprise. More brands now depend on digital media like search engine marketing and mobile media to augment broadcast television campaigns.

The report, released Thursday by the Interactive Advertising Bureau (IAB) and prepared by PricewaterhouseCoopers (PwC) U.S., also reveals that fourth-quarter revenue for 2013 reached $12.1 billion, up 17% from the $10.3 billion in the year-ago quarter. The total represents an uptick of 14% from Q3 in 2013, when revenue totaled $10.6 billion.

"It speaks to the power that digital screens have in reaching and engaging audiences," Rothenberg said. "The staggering growth of mobile is clearly a direct response to how smaller digital screens play an integral role in consumers' lives throughout the day, as well as their critical importance to cross-screen experiences."

Search and mobile marketing supported the increase in spend. Revenue from search ads rose 9% to $18.4 billion, and mobile rose 110% to $7.1 billion for the year, accounting for 17% of 2013 revenue. In search, the percentage of share fell from 46% in 2012 to 43% in 2013, but the amount spent rose from nearly $17 billion to more than $18 billion, respectively.

Online video, part of the display-related advertising numbers, brought in $2.8 billion in 2013 -- up 19% compared with the $2.3 billion in 2012, increasing its share to become the fourth largest format behind mobile.

Display-related advertising revenue reached $12.8 billion, or 30% of the year's revenue, up 7% over $12 billion in 2012.

Retail advertisers continue to represent the largest category of Internet ad spend, attributing 21% in 2013, followed by financial services and automotive, which account for 13% and 12% of the revenue, respectively.

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4 comments about "Internet Ad Revenue Hits $42.8 Billion In 2013, Surpasses Broadcast TV".
  1. DEANTHONY TAYLOR from self , April 11, 2014 at 9:28 a.m.
    I want to be the first to comment on "Internet Ad Revenue Hits $42.8 Billion In 2013, Surpasses Broadcast TV"
  2. Jeffrey Rayvid from Student , April 11, 2014 at 11:46 a.m.
    Wow. I'm surprised by this, I thought TV was still king.
  3. Christina Williams from Equinix , April 11, 2014 at 1:30 p.m.
    It's great to see these numbers and to finally have surpassed tv ad$
  4. Laura Bajkowski from BAJKOWSKI & PARTNERS , April 11, 2014 at 2:09 p.m.
    If this is based purely on spend by medium from all advertisers, then this is not surprising at all. No all advertisers can afford TV, and TV doesn't make sense for every advertiser. Based on working with Fortune 500 clients, TV is still often the largest single medium spend – even if you consolidate all digital media channel spend.