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Online Ad Spend Reaches Record $8.4B in 1Q12

June 14, 2012

Internet advertising revenues reached $8.4 billion in the first quarter of 2012, up 15% from $7.3 billion a year earlier, setting a new record for the reporting period, according to a report by the Interactive Advertising Bureau (IAB) and PwC US.

"The year-over-year growth between Q1 2011 and Q1 2012 sets quite a milestone," said David Silverman, Partner, PwC US.

"Moreover, a 15% increase over the comparable period in 2011 is a solid affirmation the Internet is delivering on its promise to attract consumers and the advertising dollars that follow."

The growth comes on the heels of strong market momentum in 2011, during which annual revenues totaled $31.7 billion, $5.7 billion or 21.9% higher than 2010 levels, according to IAB's Annual Internet Advertising Revenue Report (released in April 2012).

For the fourth quarter of 2011, online ad spending totaled $8.97 billion, up 20.4% from the previous year, and up 14.7% from the previous quarter.

Though search and display continued to lead ad formats in 2011, mobile emerged as relevant category, increasing 149%, from $641 million in 2010, to $1.60 billion in 2011.

Among key findings from 2011: 

  • Search remained the largest online ad revenue format in 2011, accounting for 46.5% of revenues, up from 44.8% in 2010. Search revenues totaled $14.8 billion, up nearly 27% from, $11.7 billion in 2010. 
  • Display-related ad revenues totaled $11.1 billion or 34.8% percent of 2011 revenues, up 15% from the $9.6 billion in 2010. Display-related advertising includes display banner ads (21.5% of 2011 revenues, or $6.8 billion), rich media (4.1%, or $1.3 billion), digital video (5.7%, or $1.8 billion), and sponsorship (3.5%, or $1.1 billion).  
  • Classifieds revenues accounted for 8.1% of 2011 revenues, or $2.6 billion. In 2010, classified ad revenue was also $2.6 billion (10% of total 2010 revenues).  
  • Lead generation revenues accounted for 4.8% of 2011 revenues, or $1.5 billion, up 15%  from $1.3 billion (5.1% of total 2010 revenues) in 2010. 
  • Email revenues accounted for 0.7% of 2011 revenues, or $213 million, up 9% from $195 million (also 0.7% of total) in 2010.

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