First Quarter Internet Ad Revs Soar

Internet advertising revenues in the United States continued to soar — reaching $1.953 billion during the first quarter of 2000, according to a Tuesday report from the Internet Advertising Bureau (IAB).

The IAB’s “Internet Ad Revenue Report,” which was conducted independently by PricewaterhouseCoopers and is based on data from over 200 companies that sell Internet advertising, reported that revenues for the first quarter grew 9.9 percent over the fourth quarter of 1999, and 182 percent over the comparative first quarter of 1999.

Rich LeFurgy, chairman of the Internet Advertising Bureau, said that growing numbers of large traditional advertisers, who have expanded their budgets for Internet campaigns, have fueled the overall growth in ad revenues.

In compiling the quarterly report, the IAB said, PricewaterhouseCoopers expanded the categorization of the types of ads being used. In addition to monitoring banners, sponsorships, interstitials and email, the report now also track classifieds, referrals, rich media and keyword searches.

According to the report, the categories which lead online spending during the first quarter were: consumer-related (31 percent), financial services (15 percent), computing (15 percent), new media (12 percent) and business services (10 percent).

The report also found that the overwhelming number of revenue transactions, (94 percent) continue to be cash-based with barter/trade and packaged deals accounting for 5 percent and 1 percent of total revenues respectively. Banner advertisements continue to be reported as the predominant type of advertising, accounting for 52 percent for the first quarter, sponsorships at 27 percent, interstitials at 3 percent and email at 3 percent.

The types of advertising being delineated for the first time include: classifieds (4 percent), referrals (3 percent), rich media (2 percent) and keyword searches (1 percent). All other ad types accounted for 5 percent of the total.

IAB touted the accuracy of its data, saying the ad report is based on information directly collected from more than 200 companies, which sell advertising to thousands of sites.