Iab Says Web Ad Spend Is $350m This Quarter

Computergram International, June 19, 1998

According to the latest quarterly report from the Internet Advertising Bureau, spending on web banner ads and sponsorships reached $351.3m in the first three months of calendar 1998, a 271% increase on the same period last year. The IAB report is relentlessly optimistic about web advertising generally, and not without reason.

The first quarter 98 is the eighth consecutive quarter of market growth, and in the four quarters since April 1 last year web ad spend passed $1bn. Between them, computing and consumer products accounted for more than half of all web ads. 55% of the money was earmarked for web banner ads with sponsorships accounting for a further 40%. Cynics used to sneer that most of these transactions took the form of favors and free equipment, but that's apparently no longer true. 98% of the transactions the IAB tracked were settled in cash. Coopers & Lybrand performs the impressive feat of calculating ad spend by getting more than 200 internet publishing entities to report their ad revenues directly. "The people who sell advertising on their sites report to us in a confidential manner," explains New Media Group head Tom Hyland. "We're not estimating. It's not like we're out there surfing the web and counting up ads. This is real." It's also claimed to be comprehensive. Hyland avers that anyone making more than $5000 per month in the USA, Germany, France and the UK will be listed, with more geographies coming soon. He also predicts continued growth indefinitely, saying he can't see any reason why the market should saturate any time soon. "The conventional ad market is worth hundreds of billions," he says. "The net has a long way to go." So where are the big-budget advertisers? According to Hyland, TV- style ads and new compensation structures will soon get them all in. It requires a changed way of thinking, he explains. When content providers become more like sales people, the market will grow. "Isn't that what newspapers are for?" he asks "selling ads?" Well, maybe. In other IAB news, the body has agreed to merge with its rival, the Internet Local Advertising and Commerce Association (ILAC). The merger "for the good of the industry" will take effect July