Kelsey Group: Interactive Ad Revenues To Reach $147 Billion Globally By 2012

Interactive advertising revenues will increase significantly from $45 billion in 2007 to $147 billion globally in 2012--representing a 23.4% compound annual growth rate, according to The Kelsey Group.

Interactive advertising--including search, display advertising, classifieds and other interactive ad products--grew its share of global advertising revenues from 6.1% in 2006 to 7.4% in 2007, per "The Kelsey Group's Annual Forecast (2007-2012): Outlook for Directional and Interactive Advertising." By 2012, Kelsey Group analysts expect the interactive share of global ad spending will reach 21%.

The forecast does not include mobile ad platforms. The Kelsey Group's mobile forecast, released in September 2007, will be updated later in 2008.

The global advertising market grew to just over $600 billion in 2007. The firm expects global ad revenues to grow at a CAGR of 2.7% and reach $707 billion in 2012, propelled in large part by considerable growth in the interactive segment.

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"It's no surprise that the global advertising industry is experiencing a full-scale shift to mixed-media platforms, with interactive driving a significant share of overall industry growth," said Matt Booth, senior vice president, Interactive Local Media at the Princeton, N.J.-based Kelsey Group, in a statement. "We see Internet development--including increased subscriber/user access and broadband penetration--as a driver of both interactive advertising revenue as well as migration of traditional ad spending to new media platforms."

During the forecast period (2007-2012), the U.S. will see interactive advertising revenues grow from $22.5 billion to $62.4 billion (22.6% CAGR), with interactive revenues in Canada increasing from $1.3 billion to $3.3 billion (21.3% CAGR).

Global directional advertising revenues--including local search, print and Internet Yellow Pages--will grow from $33.3 billion in 2007 to $41.4 billion in 2012. Local search revenues will grow from $2.1 billion to $6.6 billion (25.5 percent CAGR).

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