Sharp Rise in Online Ad Spending

Online advertising expenditures surged in the first quarter of 1998, with the top 25 industries reporting a 92 percent increase on their spending in first quarter of 1997, according to a survey by InterMedia Advertising Solutions (IAS). Internet advertising revenue now accounts for 1.3 percent of the overall market.

The study found that the computer services and software industry, at 49.7 percent, continues to account for the overwhelming majority of online ad revenue. The industry to come closest to this was the financial industry, generating 8.5 percent of all online ad revenue.

While accounting for a small percentage of online advertising dollars, the government and organizations sector reported the most significant growth with an increase of 455 percent on the 1997 figure. Other industries that substantially increased their online advertising spending were the medicines industry, 409 percent, and the local services and amusement sector 223.9 percent..

Microsoft spent the most on online advertising, at $7.7 million, followed by IBM, which spent $7.6 million.

In compiling the study, IAS tracked 300 Web sites and examined advertising reports from individual countries.