Ad Spending Keeps Increasing

Online ad spending will reach the $7.1 billion mark by 2002, according to a report by Simba Information.

The report, “Web Advertising 1998-99: Market Analysis & Forecast, credits increased Web and PC penetration for the increase in online advertising expenditures. According to Simba, $2.1 billion was spent on Web ads in 1998. In 1999, the report predicts, expenditures will hit $5.5 billion, a 161.9 percent increase over 1998.

“The biggest reason Web advertising continues to explode is that the emerging demographics of the Web look more like those of the rest of the world,” said Tim Mullaney, the author of the report. “The Web is attracting a significantly higher percentage of women and middle-income users than before, opening opportunities for publishers and advertisers whose products are completely unrelated to the act of surfing the Internet itself.”

Combines Web/online ads, which includes spending on services such as America Online, will reach $7.1 billion in 2002, a 238 percent increase over $2.1 billion in 1998, the report said.

According to Mullaney, the challenge is for Web publishers, who need to hold the audience long enough for them to absorb the advertiser’s message.