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Advertising search spend soars in 2013

Kiwi advertisers spent almost 60% more on search engine advertising in 2013 than the year before, the latest Interactive Advertising Bureau survey shows.

The report reveals the category is up 58% from last year as $206.88 million was spent, up from $140.13 million in 2012 (see graph 1)

The IAB’s ad spend results for the fourth quarter of 2013 reveals search and directories is one of the fastest growing categories, alongside mobile and video. It is understood the bulk of search and directories spend goes to Google for ad words but the IAB does not disclose which advertisers reap the most revenue within a category.

The bumper spend on paid search is well above Zenith Optimedia’s forecasts. Last year the media agency had estimated paid search to grow globally at an average rate of 14% a year to 2016.

The boom in spending reflects a healthy year for the internet advertising market, which grew 29% year on year to 2013. In 2012 the market grew just 9% (see graph 2)

When viewed against other categories of ad spend, search and directories comes out on top with 44% of ad spend. This was followed by classified ads which took up 27% of the market followed by display (such as banners) which took up 25%. 

Growth in classified advertising (on sites such as Trade Me and Seek) has been buoyed by a strong property and job market in New Zealand.

Spending on advertising for mobile devices continues to jump from a small base, jumping from $2.83 million to $5.6 million in 2013 (see graph 4)

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