Search is hot…and getting hotter

• May. 25, 2004

If there was ever a time to be concerned about online advertising spending, now isn't it. According to recent numbers released by IAB and PricewaterhouseCoopers, spending on online advertising is up almost 4% from the last quarter of 2003, and up almost 40% from the first quarter of 2003.

This incredible growth is attributed to spending on paid search (PPC) ads, while other forms of online ads dropped 7%.

Free search grew by an amazing 100% over the same time frame, proving that more and more companies are willing to invest in their online presence both through organic and sponsored search.

Both Google and Yahoo! profited by this renewed interest in online spending. Google's ad revenue jumped by 27% while Yahoo! saw a 16% increase.

At the current growth rate, IAB estimates that this year we could see US$9 billion spent in online advertising, which would be almost US$1.75 billion more than was spent last year. This would put online spending much closer to the US$10 billion estimated by the end of 2006. If the industry does hit the US$9 billion mark it would also prove to be the most successful online advertising year since 2000 when online spending hit just over US$8 billion.
 

Quarterly Online Advertising Revenues
Quarter	Online advertising (in billions)
First quarter 2004	$2.3
Fourth quarter 2003	$2.18
Third quarter 2003	$1.79
Second quarter 2003	$1.66
First quarter 2003	$1.63
Fourth quarter 2002	$1.58
Third quarter 2002	$1.45
Second quarter 2002	$1.46
First quarter 2002	$1.55
Source: Interactive Advertising Bureau (IAB)

 

Rob Sullivan
Production Manager
Searchengineposition.com
Enquiro.com