PARIS: Online advertising expenditure increased by more than 5% in France during the first half of this year, but growth did slow due to the challenging financial climate.

According to figures from SRI and UDECAM, the digital industry bodies, and Capgemini, the consultancy, ad revenues on the web rose by 6% year on year in the first half of 2012, hitting €1.3bn.

This rate of growth actually constituted the lowest expansion on record since the same period in 2009. However, online still outperformed the French advertising sector as a whole, which was up by just 1%.

More specifically, search budgets climbed by 7% to €524m, a 40% market share, benefitting as marketers placed a greater emphasis on proving return on investment.

Display enjoyed a 6% leap, to €321m, and was boosted by the surging popularity of online video and social networks, particularly Facebook.

Elsewhere, affiliate marketing logged a 7% rise, reaching €114m, while price comparison services registered a 6.5% lift to €67m, and email was flat on €54m.

Mobile ads, however, witnessed the strongest increase, up by 20% on an annual basis, yielding €22m in sales as a result.

Looking ahead, the analysis predicted that video ads will be worth €90m this year, up from €60m in 2011, and giving it a 28% share of the display category.

The study also stated that overall online adspend would attain a value of €2.7bn by the close of this year if the 6% pace of expansion is maintained.

Despite such trends, Luc Tran Thang, chairman of SRI, reported that the proportion of advertising expenditure held by digital media in France is around 15 percentage points lower than in the UK at present.

"This difference is both worrying and full of promise," he added. "If the French market can overcome the nervousness sometimes characterising it, digital's share can exceed 25%, and perhaps 30%."

If broadened to include direct marketing, as well as display, search and classifieds ads, mobile revenues were also anticipated to rise by 8% this year to €1.1bn.

Data sourced from SRI; additional content by Warc staff