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US online ad market to be worth $26 billion in 2010

MUMBAI: Online marketing and advertising in America will rival cable and satellite TV and radio ad spend in five years time. It will reach $26 billion by 2010.

 

 

This data is contained in a study done by Forrester Research. This year alone will post a 23 per cent increase on last year's figures, the report says, to $14.7 billion. The report titled US Online Marketing Forecast: 2005 To 2010 further indicates that almost half of marketers plan to decrease spending in traditional advertising channels like magazines, direct mail, and newspapers to fund an increase in online ad spending in 2005. By 2010, online marketing and advertising will represent eight per cent of total ad spend.

 

 

The report notes that despite significant changes in consumer behaviour, there is a large disparity between the amount of time consumers are spending online and the money marketers are spending trying to reach them online. When at-work Internet use is taken into consideration, online consumers spend more than one-third of their time online?roughly the same amount of time they spend watching TV. Yet marketers spend only four per cent of ad budgets online versus 25 per cent on TV.

 

 

Other key findings by Forrester Research include the fact that search engine marketing will grow by 33 per cent in 2005, to reach $11.6 billion by 2010. Display advertising, which includes traditional banners and sponsorships, will grow at the average rate of 11 per cent over the next five years to $8 billion by 2010.

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