Trends

Online Ads Soared in First Half

It’s official. 2005 is on track to be the best year for Internet advertising in history, at least in terms of the US Internet advertising industry. Released today, The Interactive Advertising Bureau and PricewaterhouseCoopers released Internet advertising revenue figures for the second quarter and the first six months of 2005. For the quarter, online ad revenues totaled $2.985 billion, a 26% increase over same period 2004.

Here are some the highlights of this report:

First 1/2 revenues rose an identical 26% reaching $5.8 billion. In both 2004 and 2005, search was the most popular ad format at 40% followed by banners and classifieds.

Here is a breakdown of US online advertising revenues by vehicle (in millions), first half 2004 compared to 2005.

Search
$1,817 in 2004 (40% total revenues)
$2,315 in 2005 (40% total revenues)

Display Ads
$942 in 2004 (20% total revenues)
$1,157 in 2005 (20% total revenues)

Classifieds
$782 in 2004 (17% total revenues)
$1,041 in 2005 (18% total revenues)

Rich Media
$368 in 2004 (8% total revenues)
$463 in 2005 (6% total revenues)

Referrals / Lead Generation
$114 in 2004 (2% total revenues)
$347 in 2005 (6% total revenues)

Sponsorship
$414 in 2004 (9% total revenues)
$317 in 2005 (5% total revenues)

E-Mail
$70 in 2004 (2% total revenues)
$116 in 2005 (2% total revenues)

Slotting fees
$92 in 2004 (2% total revenues)
$58 in 2005 (1% total revenues)

CPM (cost per impression) continues to be the choice for both buyers and sellers.

US Online advertising revenues by pricing model first half of 2004 and 2005 in millions as a % of total revenues

CPM or Impression
$2,068 in 2004 (45% total revenues)
$2,750 in 2005 (48% total revenues)

Performance Deals
$1,749 in 2004 (38% total revenues)
$2,315 in 2005 (40% total revenues)

Hybrid
$782 in 2004 (17% total revenues)
$722 in 2005 (12% total revenues)

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