 People are spending more time and money online |
The value of online advertising in the UK could top �1bn this year for the first time, an industry study has said. Revenues from online adverts rose 62%, on a like-for-like basis, to �490m in the first half of 2005, outstripping growth in overall advertising of 3%.
The Internet Advertising Bureau (IAB) said UK online ad values could surpass �1bn in 2005, driven by take-up of broadband internet connections.
More is now being spent on online than billboard adverts for the first time.
Beyond expectations
Online advertising is continuing to grow at a rapid pace, according to the study by the IAB, World Advertising Center and PricewaterhouseCoopers.
Its survey found that it now accounts for 5.8% of overall advertising expenditure in the UK.
Total online expenditure in the first half of 2005 alone was higher than for the whole of 2003.
The internet's total share of advertising overtook that of radio last year and according to IAB figures it surpassed outdoor - which includes posters and bus shelter advertising - in the most recent period.
"These results have surpassed our expectations," Guy Phillipson, the IAB's chief executive said, while adding that the internet was consolidating its position as a mainstream advertising medium.
"Now the internet looks certain to be a �1bn medium in 2005."
According to separate figures from the Advertising Association, the internet's share of advertising grew 51% to �210m in the first quarter of 2005.
Faster connections
Recent growth has been fuelled by the increased take-up of broadband internet connections, which are now used by eight million UK households.
Quicker connection times and more competitive price packages are boosting internet usage while people are spending more money online.
This, in turn, is encouraging advertisers to spend more on the medium.
"The growth in online advertising is showing no sign of slowing down," said Paul Pilkington, from PricewaterhouseCoopers.
"The internet is an exceptional medium in that it now acts as a source of entertainment, information and communication for the majority of the UK population.
"Advertisers are realising this and allocating their budgets accordingly."
Television remains the largest single advertising medium in the UK by total value, with expenditure of �4.7bn last year.
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The internet looks certain to be a �1bn medium in 2005
