• by Mark Naples , January 16, 2004

In my first column, last April, I wrote that the online ad market was a struggle, but that certain elements, namely Search and Rich Media, were going to preserve its sustainable growth. Today, while it's obvious that Search is doing most of the heavy lifting, I think its safe to say that we're in what should be that sustained period of growth, and that there are some elements of our industry - especially Search - that are heading nowhere but up in the foreseeable future.

It's fun at the turn of the year to take a look at a resource that digs more deeply into the facts and trends behind and beyond the online ad market. I'm talking about the Pew Internet and American Life Project, which is now comprised of more than three years of aggregate data, regularly updated by the Pew Charitable Trust, here in Philadelphia. In recent weeks, I've written about doing all my Christmas shopping online and about how hard it would be to reach my demographic on ESPN Television, as opposed to reaching me on ESPN.com. There are dozens of data points along these lines in the Pew study, among them:

The growth in Internet usage seems to be at a plateau. But, Internet users who have been online for three years or more, which is the cohort that graduated into the largest spike this year, discover more things to do online as they gain experience and as new applications become available. This momentum often fuels increasing reliance on the Internet in everyday life and higher expectations about the way the Internet can be used in matters both mundane and mighty.

Ever heard the "pig in the pipe" metaphor? It implies that kids who go to college and experience broadband for the first time will never go back to a dial up. Suddenly, the 31% at home broadband ratio will surge above 40% and to near the half-penetration mark. This won't happen gradually, it will happen in spurts.

The size of the online U.S. adult population is 63% of all those 18 and over. More than three-quarters of those between the ages of 12 and 17 use the Internet. Do you think that these kids will discontinue their use of the Web when they turn 18? Think of the effect of adding that 12% to the 63%, as pertains to reach - and then think about what the usage figure will be for the 12-17 age group by then. This is a 19% increase in usage we're talking about - not exactly a small number.

Within the online population, specific demographic groups have comparatively high incidence levels for certain online activities. Quoting the study:

High proportions of female Internet users have done activities such as seeking health or religious information on the Internet, while a large percentage of male users have sought news, financial information, sports news, and political news.

Among minority Internet users, a large portion of African-Americans has done research for school and sought religious and spiritual information.

English-speaking Hispanic users report high levels of instant messaging and downloading music compared to African-Americans and whites.

Those from high-income households and who have college degrees are more likely than those with more modest incomes and education to do a host of things online, including looking for government information, online banking, and participating in online auctions.

The young like instant messaging and downloading music. Older Internet users are more likely than younger users to get health information and seek material at government websites.

I might add that they're also more likely to contribute to a political campaign. But you already knew that.

Few would argue with my lead point about Search being the beast of burden for our industry today. But, Pew has culled some specific numbers to bolster this claim:

More than eight out of ten Internet users have researched a product or service online.

Overall, information-seeking activities are more prevalent among users with higher income and education levels, those with more experience online, and those with broadband access at home.

More than eight out of ten Internet users have searched the Internet to answer specific questions.

As Americans developed expectations about finding vital information on the Internet, those seeking health information online grew by 59%. There were about 46 million Americans who had looked for health or medical information online as of March 2000, and the figure grew to 73 million who had done so by December 2002. In fact, the figure is closer to 93 million, if a variety of health-related searches are asked of Internet users.

Of course, that's just a look at search as pertains to health. The report also looks at financial services, eCommerce and other segments, each with a macro eye that makes it clear just how large the trend away from TV and traditional commerce is continuing to move toward the Web.

Of course, after writing this optimistic piece, I had three pop-ups break through my pop up blocker and get in the way of my sending it to my editor. We're still a work in progress, for sure. But, there is an enormous and still growing opportunity, that's for certain.