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Digital Ad Revenues Hit Landmark High in First Half High of 2014, Surging to $23.1 Billion, According to IAB Internet Advertising Revenue Report

Mobile Jumps 76% Year-over-Year & Overtakes Banner Ads

Report Includes First-Ever Mobile Ad Format Breakdowns

NEW YORK, NY (October 20, 2014) — Internet ad revenues climbed to an historic first half-year high of $23.1 billion, according to the IAB Internet Advertising Revenue Report released today by the Interactive Advertising Bureau (IAB) and prepared by PwC US. This marks a 15 percent rise over 2013’s first-half ad revenues of $20.1 billion.

Maintaining the positive trajectory, second quarter 2014 internet ad revenues rose to $11.7 billion, representing a 14 percent year-over-year increase, up from $10.3 billion in Q2 2013.

Highlights of the report include:

  • Mobile revenues increased 76 percent to 5.3 billion at HY 2014, from the $3.0 billion (15% of total) reported at HY 2013, with the 2014 six month total consisting of $2.7 billion mobile search, $2.5 billion mobile display, and $103 million in other mobile formats
  • Digital video, a component of display-related advertising, reached $1.5 billion, a 13 percent increase in revenue over the first half of 2013 at $1.3 billion
  • Search revenues in the first half of 2014 hit $9.1 billion, up 4 percent from $8.7 billion in the first six months of 2013
  • Display-related advertising revenues in the first half of 2014 totaled $6.5 billion, a 6 percent uptick from $6.1 billion in the first half of 2013, and accounted for 28 percent of digital advertising revenue overall
  • Social media revenues, which includes advertising delivered on social platforms, including social networking and social gaming websites and apps, reached $2.9 billion in HY 2014, a double-digital hike of 58 percent over the same period in 2013, at $1.9 billion
  • The top three advertising verticals continue to account for nearly half of advertising revenue (46%), including Retail at 21 percent, Financial Services at 13 percent and Automotive at 12 percent

“This report confirms the fact that brands are deepening their commitment to interactive advertising, and that mobile is seen as a crucial part of the marketing mix,” said Randall Rothenberg, President and CEO, IAB. “Moreover, with second half revenues traditionally surpassing those in the first half of the year, this milestone achievement is potentially a harbinger of even stronger digital ad revenues to come.”

“Mobile’s continued rise speaks to consumers’ increasing reliance on smartphones and tablets, whether on-the-go or at home,” said David Silverman, a partner at PwC US. “And, digital video too is seeing gains that reflect a new ‘viewing’ paradigm that is taking place on interactive screens, big and small.”

“Consumers living online is no longer the exceptionIt is the rule,” said Sherrill Mane, Senior Vice President, Research, Analytics and Measurement, IAB. “Digital screens have become vital tools at every juncture of the day. It is no surprise that brand dollars have followed this growing movement at a steady clip.”

Annual Figures

The following chart highlights half-year internet ad revenue since the IAB began measurements in 1996; dollar figures are rounded.

Year Half Year Revenue % Growth
HY 2014 $23,091 15%
HY 2013 $20,066 18%
HY 2012 $17,028 14%
HY 2011 $14,941 23%
HY 2010 $12,127 11%
HY 2009 $10,900 -5%
HY 2008 $11,510 15%
HY 2007 $9,993 26%
HY 2006 $7,909 37%
HY 2005 $5,787 26%
HY 2004 $4,599 40%
HY 2003 $3,292 11%
HY 2002 $2,978 -20%
HY 2001 $3,720 -7%
HY 2000 $4,013 147%
HY 1999 $1,627 110%
HY 1998 $774 125%
HY 1997 $344 320%
HY 1996 $82

Total $154,781

Comparison of 2014 and 2013 Data (in millions)

Half Year 2013 Half Year 2014
% $ % $
Search 43% $8,728 39% $9,081
Classifieds and Directories 6% $1,291 6% $1,307
Lead Generation 4% $853 4% $911
Email 0% $78 n/a*
Mobile 15% $3,039 23% $5,333
Display Related
  Digital Video Commercials 7% $1,307 6% $1,481
  Banner Ads 19% $3,781 17% $3,917
  Sponsorships 2% $351 2% $366
  Rich Media 3% $640 3% $694

    Total Display-Related 30% $6,078 28% $6,459

*The survey no longer captures Email as an advertising format (effective 2014).

Revenue (Pricing Models)

Half Year 2013 Half Year 2014
% $ % $
Impression-Based 33% $6,581 34% $7,848
Performance-Based 65% $13,110 65% $14,988
Hybrid 2% $375 1% $255

IAB sponsors the IAB Internet Advertising Revenue Report, which is conducted independently by the New Media Group of PwC. The results are considered the most accurate measurement of interactive advertising revenues because the data is compiled directly from information supplied by companies selling advertisements on the internet.

The survey includes data concerning online advertising revenues from web sites, commercial online services, free email providers, and all other companies selling online advertising. The full report is issued twice yearly for full and half-year data, and top-line quarterly estimates are issued for the first and third quarters. PwC does not audit the information and provides no opinion or other form of assurance with respect to the information.

A copy of the full report is available at: iab.com/AdRevenueReport.

About the IAB
The Interactive Advertising Bureau (IAB) empowers the media and marketing industries to thrive in the digital economy. It is comprised of more than 650 leading media and technology companies that are responsible for selling, distributing and optimizing digital advertising and marketing. Together, they account for 86 percent of online advertising in the United States. Working with its member companies, the IAB evaluates and recommends standards and practices and fields critical research on interactive advertising. The organization is committed to professional development, elevating the knowledge, skills, and expertise of individuals across the digital marketing industry. The IAB also educates marketers, agencies, media companies and the wider business community about the value of interactive advertising. Founded in 1996, the IAB is headquartered in New York City.

About PwC US
PwC US helps organizations and individuals create the value they’re looking for. We’re a member of the PwC network of firms in 157 countries with more than 184,000 people. We’re committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at pwc.com/US. Gain customized access to our insights by downloading our thought leadership app: PwC’s 365™ Advancing business thinking every day

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IAB Media Contact
Laura Goldberg
347.683.1859
[email protected]

PwC Media Contact
Steven Silber
646.471.4059
[email protected]