Online ads reach $10 billion for first-half of '07

The first half of 2007 has seen a huge increase in online advertising revenue according to a report from the IAB. The report indicates that a higher percentage of ad dollars is landing online rather than traditional media, a change forecasters have been predicting for months.

by Kristina Knight

For the first six months of the year, online ad revenues increase by 27% to reach $10 billion. The first quarter saw revenues reach $5 billion and in Q2 hit $5.1 billion. Much of that revenue was built from search marketing efforts.

"This is the year that all the major agencies and media companies said, 'Digital transformation is our No. 1 priority' as well," said Randall Rothenberg, president and CEO of IAB.

Search accounted for 41% of the online ad spend while banner and display ads accounted for 21% and classified ads captured 17% of the spend. Classified ads actually saw a drop in the amount of money spent in that category; the ad dollars taken from classifieds were likely pushed into search marketing, as that category saw an increase in spending. Banner/display ads remained steady.

Lead generation revenue accounted for about 8% of the ad spend in both the first and second quarters.