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BizReport : Advertising archives : February 08, 2007

Print and radio ad spends decrease while online rises

An overall increase in U.S. advertising spend during 2007 will see increases in online spends and decreases in some offline budgets.

by Helen Leggatt

A national study by Outsell Inc. surveyed 1,010 advertisers and media players controlling a total of about $6.5 billion in advertising spending. The study, which covered online, print, events, TV/radio/movies and other, found that businesses plan to increase online spending by 18 percent in 2007, with search engine spend jumping a hefty 39 percent.

Key findings include:

- print, while still the largest recipient of ad dollars (40 percent), will continue to lose share as online’s share grows to 20 percent

- advertisers’ share of online spending for PPC ads will fall 1 percent in 2007, while CPA share will grow 8 percent and online sponsorships’ share will rise 12 percent

- 49 percent of advertisers have reduced or plan to reduce their PPC spending because of click fraud concerns

- advertisers rate online advertising very effective for branding, contrary to common wisdom that online shines at leads but is weak for branding

- the share of TV/radio/movie ad spending will decline about 3.5 percent this year

The results are in line with a trend of increased marketing dollars being committed to online activity, and a decrease in spending on traditional media such as print, TV and radio.

Tags: advertising spending, budgets, marketing, online advertising, print, radio, television

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