Internet ad revenue narrowing lead with TV ads, IAB report finds

Revenue from Internet advertising has grown to the point where it’s neck-to-neck with TV advertising, according to a new report from the Interactive Advertising Bureau (IAB) of Canada.

In 2012, Canadian Internet ad revenue topped out at $3.1 billion, a 15 per cent increase from 2011, when ad revenues reached $2.7 billion. To compare, TV advertising revenues reached about $3.5 billion, narrowing the gap and putting TV advertising ahead by just $382 million.

The Internet also landed about 27.5 per cent of revenue from major media advertising in 2012, while TV scored about 30.9 per cent. Major media advertisers include the Internet, TV, daily newspapers, radio stations, and magazines.

IAB Canada advertising spend

Published Sept. 18 and conducted by Ernst & Young LLP, the IAB’s annual report looks at the growth of Canadian Internet advertising revenue. It examines revenues from both online search and display services, as well as mobile devices. The report is now into its 15th year.

“The dramatic growth of mobile devices and their use, both in and outside the home is driving market growth. Canadians seek more information whenever and wherever they are; marketers want to be there at that moment,” said Chris Williams, president of IAB Canada, in a statement. “Additionally there is an increased use of targeting precision across search, display and video driving media efficiency.”

By the end of this year, Canadian media ad sellers like digital publishers, mobile carriers, and ad networks and exchanges, expect to see Internet advertising revenue grow nine per cent to reach about $3.4 billion in Canada. Most of this is supposed to go towards online advertising, but the budget for mobile is also expected to increase.

Right now, the biggest drivers of ad revenue in Canada are still search and display in the online category. The two ad formats netted $2.2 billion in 2012, meaning they represented about 70 per cent of all Internet revenue in Canada for that year. Online video is also shortening their lead, growing by 27 per cent to hit $92 million in 2012.

Still, in 2013 there will probably be some challenges as media ad sellers begin to pick up on new trends for Internet advertising. Some media publishers feel the rise of programmatic buying will require heavy duty data management, while others say monetizing mobile investment is still a major issue in the space.

Among media ad sellers, getting quality video content is also a priority because it helps them sell pre-roll video slots. And of course, keeping up with many of the changes in digital technology and infrastructure will require new systems, tracking, and finding employees with the right skill sets.

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Jim Love, Chief Content Officer, IT World Canada

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Candice So
Candice Sohttp://www.itbusiness.ca
Candice is a graduate of Carleton University and has worked in several newsrooms as a freelance reporter and intern, including the Edmonton Journal, the Ottawa Citizen, the Globe and Mail, and the Windsor Star. Candice is a dog lover and a coffee drinker.

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