Strongest Online Ad Spending Seen In E-Commerce, Financial Sectors

Competitive pressures drove e-commerce and financial players to sharply increase online ad spending in 1999, but online and computer-related companies continued to lead the pack, according to a new report by Competitive Media Reporting‘s CMRinteractive.

The report also showed that online ad spending climbed to 2.1 percent of the total advertising expenditures, jumping 85.9 percent to $1.910 billion from $1.027 billion the year before. The types of companies advertising also became more diverse in 1999, according to the report.

E-commerce companies boosted their spending by 153 percent over 1998 numbers, and the financial sector increased its Internet advertising outlay by 107.1 percent.

Online and computer companies spent $663.1 million — 34.72 percent of total online ad expenditures in 1999. Next came e-commerce firms, with 14.6 percent, or $278.4 million. Following them were financial players, spending $191.7 million or 10.4 percent of the total.

Although these sectors accounted for much of the total, CMRinteractive found evidence that the ranks of online advertisers are diversifying.

The top spenders included advertisers from several different parts of the economy. The top five were Microsoft ($36.2 million), IBM ($27.1 million), General Motors ($21.4 million), HP ($16.2 million) and First USA ($14.6). Toyota and Honda were also in the top ten. Others in the finance category include MBNA America Bank, Fidelity Investments, Datek Online Brokerage, Visa and NextCard. Procter & Gamble was the sole top-ten player from the consumer packaged goods category.

Other evidence for diversification includes the fact that computer-related companies’ expenditures accounted for a lower percentage of overall spending. In 1999, spending for the category made up 34.72 percent of the total. In 1998, that percentage was 44.7, and in 1997, computer-related companies accounted for 50.5 percent of all Internet advertising.