First-half internet ad revenues at $15 billion

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According to the Internet Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC US), internet ad revenues rose 23.2%—a record $14.9 billion—in the first half of the year. The rate of growth more than doubled YoY, as last year’s first-half ad revenues of $12.1 billion had represented an 11.3% increase over 2009. IAB says that the increase in revenue from advertising is a result of marketers taking more bets on digital to tell their brand stories.


Internet ad revenues for the second quarter alone also reached new heights, increasing 24.1% to $7.7 billion. That performance compares to last year’s same-period revenues of $6.2 billion, up 13.9% from 2009.

Display-related advertising—banner ads, rich media, digital video and sponsorships—totaled more than $5.5 billion in the first six months of 2011. Display increased 27.1% over the same period in 2010, substantially exceeding the previous year’s growth rate of 16%. Digital video once again commanded double-digit growth—up 42.1% over a year ago, and moved close to the $1 billion mark with $891 million in half year 2011 revenue.

Display accounted for 37% of all interactive spend in the first half of 2011, with search remaining the leading online category at 49% of the total—nearly $7.3 billion. Search and Display each grew about 27% YoY, with Search more than doubling its previous year’s growth rate of 11.6%.

In other online ad formats, dollars spent on lead generation increased 25.4% over the same period in 2010, but classified ad dollars were down 2% and email spend decreased 34.2%.

IAB also took a look at spend by specific revenue models supporting online ads. For example, ads using performance-based models increased faster than ads using impression-based models, rising to $9.6 billion. Impression-based ad spend did grow by 10.8%, though that pricing model accounted for only 31% of total ads, down from 35% YoY.

Half-year Internet ad revenue since the IAB began measurements in 1996:

 

  Year
% Growth
HY 11 $14,941 23%
HY 10 $12,127 11%
HY 09 $10,900 -5%
HY 08 $11,510 15%
HY 07 $9,993 26%
HY 06 $7,909 37%
HY 05 $5,787 26%
HY 04 $4,599 40%
HY 03 $3,292 11%
HY 02 $2,978 -20%
HY 01* $3,720 -7%
HY 00* $4,013 147%
HY 99 $1,627 110%
HY 98 $774 125%
HY 97 $344 320%
HY 96 $82  
 
 
Total $94,596  

 

Ad Category Breakouts (in millions)

  HY 2011
HY 2010
Search 49% ($7,286) 47% ($5,747)
Display Related: 37% ($5,535) 36% ($4,356)
  -Banner Ads 23% ($3,414) 23% ($2,744)
  -Digital Video 6% ($891) 5% ($627)
  -Rich Media 5% ($763) 6% ($743)
  -Sponsorship 3% ($467) 2% ($242)
Classifieds 8% ($1,237) 10% ($1,262)
Referrals/Lead Generation 5% ($805) 5% ($642)
E-mail 1% ($79) 1% ($120)

 

Revenue Pricing Models (in millions)

  HY 2011
HY 2010
Performance-Based 64% ($9,588) 61% ($7,410)
Impression-Based 31% ($4,668) 35% ($4,213)
Hybrid 5% ($686) 4% ($505)