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Video Aids Double-Digit Growth in Online Ad Spending

The Interactive Advertising Bureau (IAB) is reporting record breaking numbers on ad spending, but don’t put the down-payment on the Ferrari just yet. While it’s clear that the first half of 2010 saw a hefty increase in online ad dollars, the 11.3% increase is over the first half of 2009 which was an exceptionally bad moment in time.

Display advertising pulled in $4.4 billion in the first half of 2010 which is a 16% increase over the same period in 2009. Much of the growth came in the area of digital video advertising which is as high as it’s ever been, a full 31% over last year. This increase points to two things – consumers are responding to video advertising and ad buyers are more comfortable with the medium. Still, I’d say it’s the buyers not the consumers that are keeping video advertising from going through the roof.

Search advertising also rose this year, up 11.6% to $5.7 billion dollars in six months. Here’s the full break down from IAB.

As you can see, with the exception of a slight jockeying between Digital Video and Rich Media, the overall piece of the pie percentages have remained the same. Search is still capturing most of the ad dollars though Display is creeping up.

“Interactive advertising revenue is on a strong upward trajectory,” said Sherrill Mane, SVP, Industry Services, IAB. “Nearly all types of ad formats are showing positive movement and marketers across all advertising categories, most notably consumer packaged goods and pharmaceuticals, are increasing their investment in digital media.”

Even factoring in the economic ad dollar downturn in 2009, these numbers are encouraging. Companies are spending more money to advertise on the internet, which would lead me to believe that consumers are responding to those ads and spending their money in return. That’s the way it’s supposed to work, right? So what’s next? Will Display ever take over Search? Will E-mail ever fall off the grid entirely? I think what we need is a new category. I’d like to see social media advertising become its own line item.

Are you encouraged by these results? Want more? You can read the full report at the IAB website.

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