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Big Shift to Online Ad Spend in $40B Global Auto Ad Market by 2011

Annual revenues in the automotive advertising market will hold steady at $40 billion globally through 2011, but as audiences continue to shift online, auto ad spend will as well, according to a study from The Kelsey Group.

The report, titled “Automotive and the Internet: A Category in Transition,” is from Kelsey’s new “Marketplaces: Verticals, Classifieds & E-Commerce ” advisory service and analyzes those shifts.

According to the report:

• The internet’s share of auto ad dollars in 2007 is 5%, on par with Yellow Pages and somewhat less than Radio, DM and Magazines, each of which has a share of 7%.

• Internet’s share is expected to grow from 5% in 2007 to 13% in 2011 - or roughly on par with newspapers’ share and more than all other segments but television.

• Traditional classifieds’ share is expected to decrease from 14% to 10%, and newspapers’ share from 17% to 14%, in the same period.

“The autos category, along with real estate and travel, has enjoyed the deepest, most sustained experience among all verticals in the shift online,” said Peter Krasilovsky, Marketplaces program director for The Kelsey Group.

“For the auto industry, the internet represents an ongoing battle between third-party sites, OEM sites and dealers. There is unlikely to be a winner-takes-all outcome. But who gets the upper hand depends, in part, on utility to consumers, ability to create a brand and degree of local interaction.”