Online advertising hits record Q1 expenditure of $601m

6 May, 2011: The Australian online advertising market has continued its strong upward trend, with online advertising expenditure for the March quarter 2011 growing 17 percent year-on-year. The data, which was released today by IAB Australia in its Online Advertising Expenditure Report (OAER) compiled by PricewaterhouseCoopers (PwC), showed online expenditure for the first three months of 2011 totalled $601 million - the largest ever Q1 recorded.

Both search and directories and classifieds achieved a record Q1 performance, with search and directories recording 23 percent growth year-on-year, while classifieds increased 19 percent year-on-year.  The general display market grew more modestly year-on-year, recording three percent growth.  

Search and directories now accounts for 54.2 percent of the overall online advertising expenditure representing $326 million, with classified accounting for 24.2 percent ($145million) and display advertising recording 21.6 percent ($129million).

According to Paul Fisher, CEO of IAB Australia, whilst online advertising continues its march towards $3 billion this growth includes a small and most likely temporary shift away from general display into search. 
“Cyclically Q1 is always a cautious quarter from media agencies and their clients and down on Q4.  We expect continued double digit growth in search and directories, classifieds and a return to double digit growth for general display in Q2 and it’s encouraging to see the strong growth in the display expenditure in the real estate, retail and health, beauty and pharmaceuticals industry categories.”

Fisher concluded: “Online video advertising continues to grow strongly, up 47 percent on Q1 2010 which reflects the continued adoption of this format by advertisers looking to enhance or replace their TV schedules.”

The finance, motor vehicles, computers and communications sectors continued as the dominant users of general display advertising during the quarter, representing 38.79 percent of general display spending.  The finance industry was once again the biggest spender during the quarter, responsible for 15.39 per cent of general display advertising expenditure, down from 20 percent in Q1 2010. Real estate recorded the biggest growth in display advertising doubling year on year to reach 9.1 percent, while Retail and FMCG also recorded growth year on year.   

Real estate was the leading category for classifieds advertising expenditure during the quarter, followed by recruitment and automotive, as it was in the prior quarter and prior year.

Video based advertising maintained strong growth recording $8.44million for the first quarter, up from $5.7million in Q1 2010.  Email based advertising comprised $8.52million for the quarter, a slight increased from $7.9million in the corresponding quarter in 2010.   

The 2011 IAB Online Advertising Expenditure Report covers more than 1,000 websites.  An executive summary of the Report is available on the IAB Australia website. The full report is made available to IAB Australia members only. 


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About the Interactive Advertising Bureau
The Interactive Advertising Bureau (IAB) Limited is the peak trade association for online advertising in Australia. As one of over 32 IAB offices globally, and with a rapidly growing membership, IAB Australia’s principal objective is to increase the share of advertising and marketing dollars that interactive media captures in the marketplace. 

Incorporated in July 2010 by nine founding members  - Fairfax Digital, Fox Interactive Media, News Digital Media, ninemsn, REA Group, Ten, Yahoo!7, and Sensis Media Smart - together with the Australian Interactive Media Industry Association (AIMIA), the IAB has four objectives: 

• To develop, coordinate and promote industry standards and guidelines that make interactive advertising a simpler and more attractive medium for agencies, advertisers and marketers 
• To prove and promote the effectiveness of interactive advertising to advertisers, agencies, marketers, and the press 
• To be the primary advocate for the interactive marketing and advertising industry 
• To expand the breadth and depth of IAB membership while increasing direct value to members 

For further information about IAB Australia please visit: www.iabaustralia.com.au 

For more editorial information please contact:
Pru Quinlan or Ashleigh Favaloro
Einsteinz Communications
T: (02) 8905 0995
E: pru@einsteinz.com.au 
E: ashleigh@einsteinz.com.au 

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