Online ad spend to grow 18%

Look for online advertising spending to increase in 2007. That is the word from a new forecast from Outsell Inc. According to the report, advertising as a whole will see a 5% increase while online ad spending will increase roughly 18%.

by Kristina Knight

That growth is faster than any other segment of the market. Search advertising is expected to lead the growth rate, according to the report. Online marketers surveyed for the forecast reported that they expected to increase search advertising by an average of 39% in '07.

Pay-per-click advertising will likely fall a few percentage points in the new year according to the forecast as advertisers move away from PPC because of click fraud. Another reason marketers are moving away from PPC is because their own websites and email marketing campaigns are netting better results.

Not all advertising will see an increase in 2007, however. Ad revenue from television, movies and radio are expected to decline as much as 3%. Meanwhile, print advertising, holding steady at 40% of the market share in the past few years, is also expected to drop this year as the online spend rises.

Why are more advertisers interested in increasing their online ad spend? According to the report, online advertising is an easier market to brand and target; marketers also see the Internet as a place they can manage their brands.