Major Advertisers Increasing Online Spend

Online ad spending is growing, with the biggest spending advertisers moving more dollars to the 'Net, according to recent figures from Nielsen//NetRatings. Business & consumer services sectors account for more than half the growth.

According to results released at the recent iMedia Brand Summit in Santa Ana Pueblo, New Mexico, industries with previously traditional approaches to advertising are among those driving the move online. Companies in the automotive, pharmaceuticals, travel / hotels / resorts and insurance & real estate sectors also spent significantly more on online ads in the first quarter of 2003 than in the first quarter of 2002.

Business & consumer services, which includes large ad spenders such as financial services and telecommunications, increased online ad spend by around $100 million, representing 58% of the $172 million total increase as reported by the Interactive Advertising Bureau (IAB). The automotive sector roughly doubled its online ad spending to $57m in Q1 of 2003. Following closely was the drug/remedies category, which increased online ad spending by $26 million during the same year over year period. Travel, hotel & resorts reported positive growth of 15.5% (up $15m) and the insurance & real estate sector moved up 29% ($10m).

'The lion's share of this growth is now coming from industries known to spend significantly on traditional advertising', points out Charles Buchwalter, vice president, client analytics at Nielsen//NetRatings. Fortune 500 companies classically labelled as traditional advertisers, like auto manufacturers, are more fully adopting online media into their plans'.

Figure 1. Major Auto Advertiser Share Growth Q3 00 to Q1 03 (DaimlerChrysler, GM, Ford, Toyota, Honda, Nissan Share of Total Online Ads)



'This is more definitive evidence that the industries that spend the most on advertising overall, such as business and consumer services, autos and pharmaceuticals, are stepping up their commitment to online', says Buchwalter.

Nielsen//NetRatings AdRelevance research shows that other large advertisers like consumer packaged goods (CPG) companies are also increasing their share of online advertising impressions. The CPG companies in this study, Pepsico, Anheuser-Busch, South African Brewers, Altria and Coca Cola have used their traditional advertising savvy on the Web, turning to sports sites, among others, to reach online consumers (see below).

'These industries are among the largest advertising spenders in the world economy', says Buchwalter, 'and even a small uptick in the amount of budget they allocate to online media has an impact that is felt immediately by online publishers'.

Leading CPG Advertiser Share Growth Q3 00 to Q1 03 on Sports/Recreation Sites (Pepsico, Anheuser-Busch, South African Brewers/Miller, Altria, Coca Cola)



Source: Niesen//NetRatings AdRelevance

Nielsen//NetRatings' Web site is at www.nielsen-netratings.com