European Online Ad Spend Will Resume Acceleration in 2010

European online ad spend growth will slow dramatically this year, but will begin to recover in 2010, according to predictions from the IAB Europe.

The pan-European trade body’s annual AdEx report found that European online ad spend grew by 20 percent in 2008, reaching a figure of $18.5 billion (12.9 billion Euros) — down from 40 percent growth in 2007. Spend will continue to slow this year, achieving just 2.4 percent growth, but will pick up again in 2010 with a 6.5 percent expansion, the report predicts.

Unsurprisingly, search is expected to continue to command the lion’s share of European digital budgets, largely at the expense of classified and display ad spend. Search spend across the region is predicted to grow by 8 percent in 2009, and 11.4 percent in 2010. Meanwhile, display will remain flat this year with 0.4 percent growth but will begin to recover next year with a 5 percent expansion. Classified spend is expected to contract by 4.7 percent this year and by 0.8 percent in 2010.

Emerging formats such as in-game or online video are expected to remain relatively flat this year. However, the report, conducted in conjunction with media research firm Screen Digest, predicts that mobile advertising will “buck the trend” and continue to gain traction in 2009, driven by the proliferation of smart phones offering quality Internet access on the move.

“All advertising markets have suffered over the past year and online is no exception,” said Vincent Létang, head of advertising at Screen Digest. ” We are seeing a high level of caution in the use of emerging formats, but in the longer term we expect online video, in-game, and mobile advertising to be an important part of the online ad economy.”

Some of Europe’s more mature markets experienced slower growth than the continental average in 2008; the U.K. had 19 percent growth, and the Netherlands had just 9 percent growth. Still, other markets, particularly those in Eastern Europe, fared considerably better. Markets in Slovenia and Poland, for example, experienced growth of 77 percent and 60 percent, respectively.