Web Ad Spending Hits an Estimated $219.4 million in 1Q

Web ad revenues generated an estimated $219.4 million in the first quarter of 1998, up 161.2% from $84 million in the first quarter last year, according to an industry newsletter.

Growth was driven by advertisers that developed formalized marketing campaigns, then executing those campaigns in the first quarter, rather than creating more random banner campaigns, as many did in 1997, the report said.

Per-campaign revenue also is growing as sponsorships are replacing banners as the key moneymaker for ad-supported sites, according to Simba Information Inc.’s “Electronic Advertising and Marketplace Report” newsletter.

The Web ad market totaled an estimated $69.8 million in January, $72.6 million in February, and $77 million in March, for sequential increases of 4% and 6.1%. While consumer advertisers outnumber business-to-business advertisers on the Web, they still trail business advertisers in overall Web spending, the report said.

Yahoo maintained its stranglehold on the top spot at $17 million in ad revenue during the first quarter, up 112.5% from $8 million last year. Excite was close behind with $16 million in ad revenue, while Infoseek was a distant third with $9.6 million. CNN posted the largest year-to-year increase, up 207% to $5.5 million from $1.8 million.

Despite the growth, the market remains dominated by a handful of sites that are dependent on a handful of advertisers, the newsletter said, estimating that the 20 sites it tracks account for approximately 50% of the total market.