Online Advertising Spending Surges in 2010 to $26 Billion in the US

Online advertising is booming again, at least in the US, seeing a record year in 2010, after a small decline in 2009. Online advertising spending hit $26 billion last year, the biggest number yet, overtaking newspapers and closing in on TV. Search advertising was still king, but display ads grew faster and are catching up.

A report [PDF] from the Internet Advertising Bureau shows that online advertising is recovering nicely. With spending actually going down in 2009, it's a good sign for the industry and the economy as a whole.

"We now have had five consecutive quarters of growth since the great recession impacted interactive advertising in 2009," Sherrill Mane, Senior Vice President of Industry Services, IAB, said.

"The record-breaking revenue in Q4 2010 and the total year indicate that interactive advertising has weathered the storm and then some," she added.

Ad spending online hit $26.04 billion in 2010 in the US, a 15 percent growth from the $22.7 billion spent in 2009. Most type of ads saw a revenue growth in the past year.

Search is still the biggest draw, with 46 percent or revenue going towards it, down from 47 percent in 2009. Search advertising reached $12 billion in the last year, up from $10.7 billion.

However, this 12 percent growth was eclipsed by display ads which saw a 24 percent rise. Display ad spending now represents 38 percent of the total spent on online ads, up from just 35 percent in 2009, a 24 percent increase. Display ad spending went from $7.9 billion to $9.9 billion last year. Video ads now represent 5 percent of all spending.

"Brand advertisers and marketers have adopted the power of digital media as a central element of their campaigns," said Randall Rothenberg, President and CEO, IAB.

"Consumers have shifted more of their time to digital media -- watching television shows and movies online -- and advertisers now accept this multifaceted medium as a key component for reaching their targets," he added.