Banner Gains For Online Advertising

Less than a year after U.S. Internet ad spending surpassed $1 billion in a quarter, that figure nearly doubled in the first quarter of 2000, according to the Internet Advertising Bureau.

The bureau's Internet Ad Revenue Report — conducted by PricewaterhouseCoopers using data from more than 200 companies representing thousands of sites — pegged first quarter Internet ad revenues at $1.95 billion — up almost 10 percent versus the previous quarter, 182 percent versus first- quarter 1999.

"There is a steady increase in the number of traditional advertisers that are using online advertising as an important part of their media mix," said bureau chairman Rich LeFurgy.

Expecting the market correction and subsequent dot-com closures earlier this year to impact second-quarter results, he said any tapering in online ad spending by Internet companies to be offset by increased spending by traditional advertisers.

"The combined brand building, targeting, one-to-one marketing and e-commerce capabilities of the Internet will continue to fuel revenue growth throughout the year," LeFurgy said.

Banner ads remained the predominant type of Internet advertising, generating 52 percent of revenues, the report says. Sponsorships bring in 27 percent of the money; interstitials and e-mail, 3 percent each; classifieds, 4 percent; referrals, 3percent; Rich Media, 2 percent; keyword searches, 1 percent; other types, 5 percent.

LeFurgy said the numbers confirm the efficacy of the banner ad, which he compared with the 30-second TV spot, whereas "with some of the rich media types, we're still in the evolution phase."

Consumer-related spending lead all categories in the first quarter with 31 percent, followed by financial services and computing, 15 percent each; new media, 12 percent; and business services, 10 percent.

Reflecting the growth of e-commerce, nearly half, 48 percent, of ad deals were classified as hybrid, CPMs or impression-based purchases accounted for 42 percent of ads, and performance-based deals accounted for 10 percent of spending.

Credits: Adweek