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Web advertising revenue reaches $1.1B, record high

Internet advertising revenues exceeded $5.2 billion for the third quarter of 2007, representing a 25.3% increase and $1.1 billion increase over Q3 2006, according to research by the Interactive Advertising Bureau and PricewaterhouseCoopers LLP.

The results, published in the IAB Internet Advertising Revenue Report, are nearly 3% higher than in the second quarter of this year which, at the time, represented a record as well.

“This is the third quarter of the year and the third record quarter of the year,” said David Doty, SVP of marketing at the Internet Advertising Bureau. “So quarter over quarter we are seeing new highs. I think this reflects that marketers are understanding the power of interactive media, not only to target consumers, but to build brands and relationships by speaking to their customers in an interactive way.”

Doty said that there were plenty of examples of good interactive advertising to cite as contributors to the medium’s success, but singled out BMW’s Web site, relearntodrive.com, which prepares consumers looking to hone their skill, as a good example.

All three quarters in 2007 have set new highs — the first quarter hit $4.9 billion, Q2 reached $5.1 billion and Q3 has now hit a new high of $5.2 billon. Revenues for the first nine months of 2007 totaled $15.2 billion, up almost 26% over the $12.1 billion recorded during the first nine months of 2006.

The IAB Internet Advertising Revenue Report was first issued by the IAB in 1996, and represents data from all companies that report meaningful online advertising revenues. The survey includes data concerning online advertising revenues from Web sites, commercial online services, free e-mail providers, and all other companies selling online advertising.

The full report is issued twice yearly for full and half-year data, and quarterly estimates are issued for the first and third quarters.

First and third quarter revenue reports are estimates, with the actual figures being released along with second and fourth quarter data, respectively.

Doty speculates that total online advertising revenue could reach $20 billion by the end of the year.

“Interactive is the new fulcrum in which all advertising will be based,” Doty added. “Interactive is more measurable than any other medium in the past, and yet it is able to deliver broadbrand communications.”

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