US online adspend growth slows

01 April 2009

NEW YORK: US online adspend rose by 10.6% last year to $23.4 billion (€17.7bn; £16.4bn), the slowest pace of expansion since 2002, according to figures researched by consultancy PricewaterhouseCoopers on behalf of the Interactive Advertising Bureau.

While online revenues are expected to expand in the US this year, predictions vary from a double-digit annual improvement to an uplift of just over 1%.

According to the IAB, the medium's growth rate for the whole of last year slowed from 26% in 2007, and fell to just 2.6% in Q4 2008 – amounting to an extra $6.1bn in revenues – compared with an expansion of 24% in the year-ago period.

Search expenditure increased by 20% over the course of the year to a value of $10.5bn, with display ad revenues growing by 8% to $7.6bn, despite a drop off of 4% in the last quarter.

On a more positive note, online video spending more than doubled to $724m during 2008.

David Silverman, a partner at PWC, said the "economy has had a significant impact on the short-term growth of the internet ad market."

Data sourced from Wall Street Journal; additional content by WARC staff