Billion Dollar Run-Rate Highlights Eighth Consecutive Quarter of Revenue Growth For Internet Advertising. Q1 1998 Ad Spending Climbs to $351.3 Million Increases 271 Per Cent Over Q1 1997.
SAN FRANCISCO – June 17, 1998 – The Internet Advertising Bureau (IAB) today announced the first Quarter 1998 results of its industry-leading “Advertising Revenue Reporting Program,” with total first quarter spending reaching $351.3 million, an increase of 271 per cent over the first quarter 1997 and the eighth consecutive quarter of positive revenue growth. According to the report, which was presented by Coopers & Lybrand at the IAB’s annual membership meeting in San Francisco, Internet advertising continues its billion dollar run-rate for the second quarter in a row, and continues to trend towards a traditional media model, with computer and consumer-related advertising leading the way.
“We saw the first significant signs that Internet advertising was trending towards the traditional media model with last year’s fourth quarter results,” said Rich LeFurgy, IAB Chairman and Senior Vice President Advertising Buena Vista Internet Group. “The results for the first quarter of this year underscore the fact that the Internet is now considered an integral component of the overall media mix, and subject to the same variables as all other forms of advertising.”
The categories which lead Internet Advertising spending during the first quarter were computing (27%), consumer-related (25%), telecom (14%) financial services (13%) and new media (10%). The survey also found that the overwhelming number of revenue transactions, (98%) continue to be cash-based with barter deals accounting for (2%) of total spending. Banner advertisements continue to dominate spending in the category (55%) with sponsorships (40%), interstitials (4%) and others (1%) rounding out the category.
Conducted by the New Media Group of Coopers & Lybrand on an ongoing basis, with results released on a quarterly basis, the “Advertising Revenue Reporting Program” was started by the IAB in 1996, and represents data from more than 200 publishers. The results reported are the most accurate measurement of online advertising revenues since the data is compiled directly from information supplied by companies selling advertising on the Internet. All-encompassing in nature, the survey includes data concerning online advertising revenues from Web sites, commercial online services, off-line delivery services and e-mail providers.
“The continued vibrancy of Internet advertising, as exemplified by the continued strong quarter-to-quarter growth, and the growing number of advertisers who now consider a strong presence on the Internet as key to their overall branding strategies, reinforce the importance of the medium as an integral component to across-the-board advertising coverage,” noted Tom Hyland, Chairman, Coopers & Lybrand New Media Group. “Increasing online spending and consumer usage only reinforce the Internet’s growing importance to advertisers.”
Founded in 1996, the IAB is the leading online advertising association with over 250 active members. Its activities include evaluating and recommending standards and practices, fielding research to document the effectiveness of the online medium and educating the advertising industry about the use of online advertising. Current membership includes companies that are actively engaged in the sales of Internet advertising, with associate membership including companies that support advertising, — interactive advertising agencies, measurement companies, research suppliers, technology suppliers, traffic companies and other organizations from related industries. A global organization, the IAB has member countries including Canada, France and Germany, and is currently developing membership countries in Asia and Latin America, as well as other countries in Europe.