US Online Ads in Q2 Decline, UK Equivalent Up 21%

09 October 2008

NEW YORK: US online advertising – hitherto seen as invulnerable to the credit crunch – has seemingly succumbed to the financial malaise sweeping the globe.

Second quarter online adspend rose 12.8% to $5.7 billion (€4.18bn; £3.24bn), a sharp year-on-year decline from +18.2 % in the preceding quarter and the full-year figure of +25% in 2007.

The latest data from the Interactive Advertising Bureau imply that although the long-term shift of advertising and e-commerce from traditional sources to online media is set to continue, the web may now be more exposed to an economic downturn than previously believed. Meantime, on the other side of the herring pond ...

  • UK Online Spend Remains in Growth Mode
    On the face of it, it's a different story in Britain, where the Internet Advertising Bureau reports that adspend grew 21% to £1.7bn in the first half of 2008. This compares with a 0.7% decline in the overall advertising market. 

    Other data includes:

    • The rise came as the total ad market fell 0.7% year on year to £9bn, as TV, press, outdoor and radio all experienced falls in expenditure.
    • Online has therefore increased its market share by four points to 18.7%, only 0.6% behind total press display (19.3%) and 3% behind TV (21.7%).
    • Paid-for search continues to lead the way, growing by 28% year on year and was worth £981m in the first half of 2008, with its market share marginally up to 58.3% of total online advertising (57.8% in first half of 2007).
    In real terms, online adspend increased by £348.2m when compared with the same period in 2007.
  • Data sourced from Financial Times and BrandRepublic; additional content by WARC staff