U.S. internet advertising revenues continued to spiral, totaling $16.9 billion in 2006 – a new annual record – growing 35% from 2005, according to the Internet Advertising Revenue Report released today by the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers LLP (PwC).
Moreover, in the fourth quarter of 2006, revenues totaled $4.8 billion – a new quarterly record – and a 35% increase over the fourth quarter of 2005.
Consumer advertisers still constitute the largest category of internet advertising spending; and search, display, classifieds and lead generation all continue to grow at a healthy rate, with an increase in both performance-based and CPM or impression-based pricing, according to the report.
Some key full-year 2006 findings from the IAB report:
- Consumer-related advertisers accounted for 52% of 2006 internet ad revenues, up from 51% from 2005.
- Within the Consumer category the biggest sub-categories are Retail (47% of 2006 consumer revenue category), Automotive (22%), Leisure (13%), Entertainment (8%) and Packaged Goods (8%).
- Financial Services, the second-largest category, accounted for 16%, followed by Computing advertisers at 10%.
- Search revenue accounted for 40% of 2006 revenues, slightly less than the 41% for 2005.
- Display advertising, Classifieds, and Referrals accounted for 32%, 18%, and 8% of 2006 revenues, respectively.
- Survey participants reported that some 5% of 2006 full-year revenues were priced on a hybrid basis, down from 13% in 2005.
- About 47% of 2006 revenues were priced on a performance basis, up from 41% for 2005.
- Approximately 48% of revenues were priced on a CPM or impression basis, up from 46% in 2005.
- Internet advertising revenues accounted for approximately 5.9% of total U.S. ad spending in 2006, up from approximately 4.7% in 2005.
A copy of the full report is available at http://www.iab.net/resources/ad_revenue.asp.
The IAB sponsors the Internet Advertising Revenue Report, which is conducted independently by the New Media Group of PwC. The full report is issued twice yearly for full- and half-year data; top-line quarterly figures are issued for the first and third quarters.
The survey includes data concerning online advertising revenues from Web sites, commercial online services, free e-mail providers, and all other companies selling online advertising. First and third quarter revenue reports are estimates, with the actual figures being released along with second and fourth quarter data respectively.
