Overall online ad spending in the US was up almost 13 percent compared with Q2 2007, but down slightly (0.3 percent) from Q1 2008. Online ad revenues for the second quarter were $5.7 billion, compared with $5.8 billion in Q1. Revenues were $11.5 billion for the first six months of 2008 vs. approximately $10 billion during the same period in 2007, according to the IAB.
Search took a bigger share (44 percent) of the pie than it did in the first half of 2007 (41 percent). Otherwise the first six months of 2008 look quite similar in most respects to the first half of 2007. The question now is: how will a souring economy impact Q3 and Q4?
Here are some IAB graphics reflecting the spending trends:
Most ad categories are flat or differ by a percentage point, except for Search and Classifieds (which includes yellow pages/directories). Those two saw gains and losses of three points respectively. The concentration of ad spending among the top online players remained consistent with 2007 in terms of percentage distribution.
Among the top spending industry categories, retail and financial services were down slightly in the first half vs. last year:
Expect those numbers to decline further in the second half, as weakness in both sectors gets (perhaps much) worse before things improve.
Overall, performance based advertising saw gains of 2 percentage points, while CPM pricing saw an equivalent decline in the second quarter vs. a year ago. I would also expect this trend to continue in the second half as advertisers look to the greater “accountability” of performance-based pricing from their online ad buying.
This will continue to benefit search in a relative sense, but no one will likely be spared the effects of the recession.
There’s more discussion of the numbers at Techmeme.