NZ online advertising grows 18% year-on-year

The Interactive Advertising Bureau of New Zealand (IABNZ) and PricewaterhouseCoopers (PwC) have released online advertising expenditure figures for Q3, 2010.

The growth of New Zealand’s online advertising market continues, with the most recent July-September 2010 quarter totalling to $67.93m, up $4.83m on the Q2, 2010 result.

Liz Fraser, IABNZ Chair says, “There is no stopping online growth. A whopping 17.66% increase year-on-year for the same quarter, with the largest category growth coming from Display – up 24% on the same quarter as last year. The full year figure is looming as the year comes to a rapid close.

The result mirrors third-quarter stats collected by the IAB in the US, which recorded a record $US6.4 billion online ad revenue - again with display advertising growing most strongly.

Tracking to over-take radio and magazines
Online advertising is tracking to overtake radio and magazines, based on the 2009 percentage share figures. Naturally in 2010, other media have also increased revenues year-on-year, so the race is on.”

Search & Directories showed the largest quarter-on-quarter growth at 16.38% however

Display showed the biggest year-on-year increase at 24.07%.

Laura Maxwell-Hansen, IABNZ Vice-Chairman, says, “display advertising has really taken the lion’s share of uplift in advertising spend from last year. It continues to be the go-to product for advertisers, with the largest range of products on offer and the ability to consistently deliver on advertising and business objectives of clients. No longer a dirty word, “banner ads” have innovated and offer a far more sophisticated solution for advertisers. Results in rich-media, video and direct response campaigns are proving that audiences do respond to great creative and sound retail offers.”

When it comes to where advertisers are spending their money online the split is pretty even with Search & Directories leading with a 37% share followed by Display 32% and Classifieds 31%.

“The channel spilt is an interesting one to watch. In Australia, Search & Directories makes up almost half of the total spend while in the UK it has a 60% share and in the US 47%," adds Alisa Higgins, IAB General Manager.

The biggest Display advertisers were Investment, Finance and Banking; Government departments, services and communities, and Travel and Accommodation in NZ. They accounted for almost 40% of total display dollars in Q3, 2010.

The highest spending advertiser categories in Australia were Finance followed by Motor Vehicles and Computers and Communications. Together these accounted for 43.5% of the total General Advertising expenditure. The top UK industry sectors for Display were Entertainment/Media; Finance and Consumer Goods.

PricewaterhouseCoopers partner Chris Perree says: “Online advertising revenue continues to grow at remarkable rates, with all categories showing solid double digit growth on the same period last year.

This trend reflects the accelerating shift in consumer behaviour towards the internet. The use of the internet as a means of marketing is maturing, especially as broadband penetration increases and faster broadband connections offer enriched media options and boost internet browsing time. From the advances in technology we are seeing new trends this year.

With the release of the iPad and improved smartphone devices, companies are rolling out mobile websites to operate on these platforms.

The likely growth in such devices will expand the overall online audience and drive online advertising. Furthermore, we are seeing social media gaining increasing viability amongst advertisers and publishers as a medium to connect with their target audience on a personal level.

It is fantastic to see this thriving industry grow, and to be able to support the IABNZ in their mission to provide an accurate barometer of online and interactive advertising growth.”