Sep. 24, 2007

According to recent numbers published by TNS Media Intelligence, on average, Internet display advertising grew almost 18 percent to $5.5 billion between April 1st and June 30th of this year.

But TNS Media also found that total ad spending in the first half of 2007 actually fell about 0.3% to $72.59 billion, versus the corresponding period last year.

Steven Fredericks, CEO of TNS said that "for the first time since the past six years, media advertising expenditures have actually declined for two consecutive quarters."

Fredericks added "given the many uncertainties about near-term economic growth and consumer spending, we expect that on average, core ad spending will continue to face challenges during the second half of 2007."

However, TNS research director Jon Swallen said "the results differ by industry. For example, financial services advertisers are moving more money to Internet display ads from other media. Overall, the Internet gets about 22 cents out of every dollar invested in financial services ad spending."

Swallen added that "by contrast, pharmaceutical firms are not making the same moves and are actually underallocating to display advertising."

"Internet spending growth used to be driven by small and midsize businesses. Now it's the large companies like consumer packaged goods firms which are getting more into the Internet," said Swallen.

"The overall percentage of budget allocated to display ads by the top fifty blue-chip firms is still comparatively low, but that is now changing," said Swallen.

On average, eMarketer's own U.S. Internet ad spending estimates include search and video figures as well as display.

For this year, eMarketer estimates that total online ad spending will reach about $21.68 billion, up from $16.9 billion last year.

Source: eMarketer