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    • Online Ad Spending Grows 10%; Video Ads Strong (Just Not at Google)

      Posted on March 31st, 2009 Andy Beal No comments

      In yesterday’s report, we informed you of the dramatic decline the newspaper industry is seeing in advertising revenue. Perhaps the most shocking revelation was that newspapers saw a 1.8% decline in online advertising revenues. You might have downplayed that decline due to the overall decline of online spending. However, new data from the Interactive Advertising Bureau, in conjunction with PriceWaterhouseCoopers, reveals growth of just over 10% in online ad spending.

      Web ad spending hit $23.4 billion in 2008, up 10.6 percent over 2007. Fourth quarter 2008 revenue growth was more conservative at 2.6 percent; total online ad spending for the quarter was $6.1 billion.

      While that 10.6% growth is down from the whopping 26% growth seen in 2007, it’s still pretty darn good–and shines a bright spotlight on just how badly the newspaper business is doing with its migration to online formats.

      Breaking down online ad growth, we see that search grew 20% and performance-based ads rocked the house with an impressive 57% share of all ad spending.

      I’ll leave you with one stat that left me scratching my head

      [David Silverman, partner at PriceWaterhouseCoopers] cited video ad spending as a significant growth category. Video advertising revenue rose from 2 percent in 2007 to 3 percent of overall online ad spending in 2008.

      So why did Google just shut down its video ad units?

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