The online Australian advertising market grew 17% year on year in 2011 to $2.66 billion, defying the challenges facing the broader media market.
The results, announced by IAB Australia in its Online Advertising Expenditure Report (OAER) compiled by PricewaterhouseCoopers (PWC), revealed the online advertising market has slowed from 21% growth in 2010 to 17% in 2011, with search and directories leading the growth.
IAB Australia CEO Paul Fisher said: "With the current challenging financial climate predicted to continue, we believe advertisers and their agencies will increasingly turn their attention and budgets to the branding and direct response opportunities that can only be found online."
He believes the results place Australia well on track to surpass the $3 billion mark in 2012 as forecast by IAB and PwC, and to reach 20% market share.
According to Fisher, the increase in online advertising correlates with consumer behaviour. "The continued and much publicised consumption of media content and services online which is driving this double digit growth is in turn driving a change in the advertising expenditure habits of media buyers and importantly, advertisers.”
Overall market growth was powered by the search and directories category which now comprises 53% of the total spend, valued at over $1.4 billion for 2011. General display advertising accounted for 23.8% and $632 million of the total spend spend, while classifieds advertising accounted for 23.1% and $615 million of the total spend.
The general display category grew strongly for the second half of the year, reaching 17% year on year growth, however it was disappointing over the full year, achieving just 4% year on year growth.
The motor vehicle category continues to show the most growth year on year at 13%.
According to Fisher, government spending online is low, with Defence being the only exception.
Fisher said: "In the current political climate, with the impending State election in Queensland and a Federal election in the next two years, I would expect to see a strong surge in the advertising expenditure online by all State and Federal political parties."
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