Online ad revenues rise 15% to $3.1b in 2012, IAB says

Online advertising revenues in Canada rose 15 per cent in 2012, reaching a total of $3.1 billion, said a new report by the Interactive Advertising Bureau of Canada. Chris Williams, president of IAB Canada, said in a telephone interview that the revenues were slightly higher than forecasted for 2012. “In general, marketers are looking more and more for performance and understanding things like real-time metrics,” he said, adding that the Internet platforms can give advertisers information about the success of their advertising campaigns that can’t be matched by other mediums, such as how much time people are spending viewing ads. “These are the kinds of things that allow them to just feel more comfortable and if they do that, then they are likely to continue spending more in that space,” he said. The report, released Wednesday, said online ad revenues, which account for 95 per cent of overall Internet (including mobile) ad revenues in Canada, grew 13 per cent in 2012, while mobile revenue doubled to $160 million. Williams said Canadians are using more tablets, smartphones and other mobile devices and spending more time on them, inside and outside the home, “so it’s only natural that marketers want to advertise to people in that environment.” The report said that, compared to the Internet, “other major media grew modestly or declined somewhat,” with television advertising revenue falling two per cent and daily newspaper revenue rising two per cent, the report said. It noted that the total Internet ad revenue number is “close to 90% of TV’s 2012 ad revenue level.” Search and display were the top ad formats, collectively responsible for more than 70 per cent of Canadian Internet ad revenue, the report said. “With 21% growth, Search was the key driver behind the Internet’s 15% revenue expansion in 2012. Search has been growing at a consistent 19-22% annually over the past five years,” the report said. “Display grew at 9% in 2012, which was unusually low compared to its 18-22% annual growth rates during 2008-2011.” Online video advertising rose 27 per cent during the year to reach $92 million. The report said that online video and mobile “outpac overall Internet revenue growth,” and that “it is very early days for both formats.” Survey respondents predicted that Internet ad revenues would continue to grow in 2013, rising nine per cent to $3.4 billion. Bob Reaume, vice president of policy and research at the Association of Canadian Advertisers, said in a telephone interview that the growth of Internet advertising will eventually plateau. While the first ad on the Internet was almost 20 years ago, he said, “it is still very much a new-ish medium.” “Advertisers know they have to be there, so they’re taking money out of other traditional media to experiment with the Internet. That’s fueling a lot of growth right now. It’s to be expected,” he said, adding that television had the same effect on newspapers, and media platforms, like newspapers, magazines and radio, aren’t “going away.” “This is the advertising shakeout,” he said. The survey was conducted by Ernst & Young and is based on data results from Canadian online publishers that sell advertising on websites, ad networks and exchanges, as well as mobile carriers, aggregators, marketing companies, and online publishers “offering Mobile advertising solutions.” —With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Simon Doyle at sdoyle@thewirereport.ca

Online ad revenues rise 15% to $3.1b in 2012, IAB says

News | 09/18/2013 8:14 pm EDT

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