Online Advertising Dropped 5.3 Percent in the First Half of 2009

It's been a rough year for advertising so far and online advertising hasn't been spared. Though not hit as hard as other segments, online ad spending dropped 5.4 percent year over year in the US in the second quarter of this year. Overall the market shrank 5.3 percent for the first half of the year, dropping to just $10.9 billion. It wasn't all gloom and doom though as some segments actually grew in 2009 with video ads rising by 38 percent compared to last year.

“We are in one of the most difficult economic slumps in decades. Interactive is one of the advertising sectors that has been least affected,” Randall Rothenberg, president and CEO of the IAB, said. “In recent years the digital revolution has driven a transformation of how consumers experience advertising and media. As the economy improves, we’re confident that brands will devote an even greater share of their budgets to reaching consumers as they make interactive media a larger part of their lives.”

Search advertising took the lion's share, with 47 percent of the entire online ad market in the first half of this year. Search grew 3 percent points since last year but due to the smaller overall market the revenue increase was only modest, from $5 billion in the first half of 2008 to $5.1 billion this year. Display ads came second with 34 percent of the market and $3.7 billion in revenue. In the display ads category banner ads stood out with 22 percent of the overall market, revenue of almost $2.4 billion.

Digital video ads, also part of the display ads category, grew to reach 4 percent of the ad spending in the first half of 2009, still a relatively small share, but with a growth of 38 percent over the same period of last year its share is definitely going to get a lot bigger in the coming years. Classifieds dropped this year by 4 percent points with revenue of just $1.1 billion. TV advertising was down 12.3 percent in the first half of the year to $20.1 billion.