Internet ad revenues at $10.9B for first half

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The Interactive Advertising Bureau and PricewaterhouseCoopers released the IAB Internet Advertising Revenue Report for the first half of 2009. U.S. Internet advertising revenues were at $10.9 billion in that period, a 5.3% decline from the same period in 2008.


Search and display-related advertising continue to represent the largest percentages of overall interactive advertising spend. Search revenues amounted to more than $5.1 billion for the first six months of 2009, up slightly from that same period in 2008. Display-related advertising—which includes display ads, rich media, digital video and sponsorship—totaled nearly $3.8 billion in the first six months of 2009, showing a relatively modest 1.1% decline from the same period in 2008. Digital video continues to experience robust growth with a 38% increase from the first half of 2008.

“We are in one of the most difficult economic slumps in decades. Interactive is one of the advertising sectors that has been least affected,” said Randall Rothenberg, President and CEO of the IAB. “In recent years the digital revolution has driven a transformation of how consumers experience advertising and media. As the economy improves, we’re confident that brands will devote an even greater share of their budgets to reaching consumers as they make interactive media a larger part of their lives.”

“While the overall advertising market has continued to be impacted by current economic conditions, marketers are allocating more of their dollars to digital media for its accountability and because consumers are spending more of their leisure time online,” said David Silverman, PwC Assurance partner.

The following data highlights key first six-month revenue data breakouts; dollar figures are rounded.

($ millions if not indicated):
Advertising Formats: Search and Display-related ads continue to be leading formats.

 
FH 2009
FH 2008
Search
47% ($5,148)
44% ($5,064)
Display Related:
34% ($3,759)
33%($3,799)
    -Banner Ads
22%($2,394)
21%($2,418)
    -Rich Media
7% ($704)
7%($806)
    -Digital Video
4%($477)
3%($345))
    -Sponsorship
2% ($184)
2% ($230)
Classifieds
10% ($1,116)
14% ($1,611)
Referrals/Lead Generation
7% ($728)
7% ($806)
E-mail
1% ($149)
2% ($230)

Industry Concentration: Percentages of revenues by the top 10, top 25 and top 50 have remained consistent.

 
FH 2009
FH 2008
Top 10
71%
70%
Top 25
82%
81%
Top 50
89%
90%

Pricing Models: Performance deals continue to be the leading pricing models, followed closely by CPM deals.

 
FH 2009
FH 2008*
Performance Deals
58%($6,363)
54%($6,260)
CPM
38% ($4,059)
42% ($4,750)
Hybrid
4% ($478)
4% ($500)

*NOTE: FH, 2008 Pricing Models numbers have been restated based on additional data received after the IAB Internet Advertising Revenue Report covering the first six months and the second quarter of 2008 was published on October 7, 2008.

A copy of the full report is available at: http://www.iab.net/AdRevenueReport