Commentary

No One Wants To Say the "B" Word

After spending the last decade in online advertising, I've gone from boom to bust to blasé to bobbing my head above water. I'd like to think that after such survival skills (or craziness), I'd have something to look forward to. Well finally we all can breathe a bit easier.

I'm not sure if you've heard, but some record growth stats were released about our love-hate industry. Online ad revenues are said to have hit an all time high according to the Internet Advertising Bureau (IAB) and Price Waterhouse Coopers.

Yes, it's true, online ad revenues hit a whopping $2.2 billion USD last quarter. This is the highest since both began to track spending back in '96. Oh yea, and the "bubble" was a result of numbers totaling $2.1 billion USD in Q4 of 2000. However, we are still behind total ad spending of 2000 by 11%.

What do you think has attributed to such growth?

Paid search. Dubbed the hottest on the 'Net right now, eMarketer says paid search grew 300 percent during the first half of 2003, sparking 10 percent overall growth. (A 123% increase last year.) eMarketer predicts further growth that should yield 32.5% of all online ad revenue this year.

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800-lb Gorillas. Strong growth reported by Yahoo!, MSN, and CBSMarketWatch have fueled spending. AOL is said to still be hurting. We'll have to see what's up its sleeve this year for a hoop-jumping recovery plan.

Rich media. Some love it, some love to say they hate it. Most say the consumer experience is like no other. Rich media ads accounted for 40% of all online ads Q4 '03. This reflected a year-to-year rise of 60%, while showing a higher conversion rate of post-impression activity at 1.11%, compared to non-rich media at 0.43%, reported by DoubleClick Inc.'s latest Ad Serving Report.

Broadband Adoption. As broadband penetration increases (from 36.8% now), the user experience is intended to as well. Many report that price is forcing people to wait.

Acceptance. You remember fighting for it. Ask just about anyone nowadays and they'll say it's a part of an overall media mix. If it isn't getting a portion of the media pie, its most likely been considered.

Usage. Internet usage is still taking time away from TV. The UCLA is about to announce a report that includes top-line findings: Internet users watch 28% less TV than non-Internet users. Internet users spend about 11.8 hours online per week. More than half this time has been taken away from television.

I think the bottom line is, the industry has quickly grown up. What do you think?

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