Avenue A/Razorfish Billings Soar To $418 Million

Avenue A/Razorfish media billings surged 34 percent last year to total $418 million, according to the company's "2006 Digital Media Outlook," scheduled for release today.

Overall, the agency purchased media on 728 Web sites--up from 654 in 2004. Fifty-six of those sites, or about 8 percent, accounted for more than $1 million each in billings; last year, 26 sites, around 4 percent, represented more than $1 million in billings.

The agency also reported that search marketing gained market share, accounting for 31 percent of the total--up from 28 percent in 2004. But this year, display ads are likely to outpace search, said Jeff Lanctot, vice president and general manager at Avenue A/Razorfish. "Search is maturing as a category," Lanctot asserted, adding that the agency predicts that search will account for between 28 and 30 percent of billings this year.

The proportion of ads on vertical sites fell to 35 percent from 39 percent. Media billings on portals represented 13 percent of Avenue A/Razorfish's total--up from 12 percent last year--while ads on networks totaled 12 percent of the total, up from 11 percent last year.

The agency reported that ad spending more than doubled on entertainment-oriented sites (165 percent increase), sports sites (139 percent), community sites like MySpace (132 percent), finance sites (124 percent), and health sites (30 percent). Cost per thousand display impressions also increased between 19 and 30 percent in all of those categories except for community sites, where the cost of display ads fell 19 percent. Display pricing also plummeted in the travel category, where cost per thousand impressions dropped 35 percent.