It’s all relative: Internet ads grow as economy contracts

The sub-prime economic crisis in the US is accelerating the share of ad spending on Internet advertising, according to a new IDC report.

During the next five years, Internet advertising is predicted to grow eight times as fast as traditional advertising, doubling from US$25.5 billion in 2007 to US$51.1 billion. That means by 2012 the Internet will be the second-largest area of advertising spend, behind direct marketing and in front of TV, radio, and newspapers. The Internet is currently number five on the list.

According to IDG, “Video advertising will be the principal disruptor of Internet advertising over the next five years by attracting the most new marketing dollars. Its revenue will grow sevenfold from $US0.5 billion in 2007 to $US3.8 billion in 2012 at a compound annual growth rate (CAGR) of 49.4%. This growth will take place because brand advertisers will shift significant amounts of money into these video commercials, primarily from broadcast television.”

Would love to see some equivalent statistics for Australia if anyone has them.

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