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NZ Online advertising tops $135 million for 2007
The Interactive Advertising Bureau of New Zealand today announced the release of the IAB/PwC Insight report for Q4, 2007. The report shows New Zealand online advertising was $135.17 million for the 2007 calendar year.
The IAB reports that Q4 spending was down slightly at $37.85 million from Q3’s total of $39.67 million but larger than both Q1 and Q2.
Mark Evans, CEO of the IAB says that the total spend in 2007 is higher than many in the industry had predicted and shows that interactive advertising is becoming an increasingly significant part of New Zealand marketing budgets.
At $135 million for the full year, interactive advertising represents 5.8% of total advertising spend in New Zealand. Evans says that while this is already a significant percentage, in many overseas markets – such as the US and UK – interactive advertising represents over 10% of total advertising in the US and in the UK over 15%. “This figure shows there’s still plenty of growth to come, and we expect continued strong growth over the next few years,” says Evans.
Lee Williams, Chairman of the IAB says the size of the interactive advertising market in New Zealand shows that interactive advertising is starting to become mainstream. “At $135 million, interactive advertising is starting to challenge some of the more traditional media types. The only question in my mind is not if, but when, interactive advertising becomes one of the leading channels for New Zealand advertisers”, Williams says.
The IAB/PwC Insight reports that classified advertising is the largest segment of interactive advertising at 43.62%, with display advertising accounting for 32.85% and search and directories for the remaining 23.53%.
Asked about where growth is expected to come from, Evans says that both display and search and directories advertising in New Zealand are still lower as a percentage of total interactive advertising spend than in other countries and predicts strong growth in both those sectors in 2008 and beyond.
Evans says that one of the big drivers for growth is that marketers are realising their advertising spend is out of kilter with the media consumption habits of their target audiences. “Kiwis spend almost 20% of their media consumption time online”, he says, “and yet less than 6% of advertising spend is online”.
“Advertisers are starting to realise that they need to follow the eyeballs, and when they do invest in interactive advertising, they’re finding it to be an incredibly potent medium both for driving direct response, and for branding”, Evans says.
Evans predicts that higher broadband speeds and lower prices will also fuel growth, as will predicted growth in mobile internet usage. “Mobile advertising is in its infancy here in New Zealand”, says Evans, “but global predictions are for an explosion in mobile advertising over the next 3-5 years, which is why we’ve recently setup an IAB sub-committee focusing specifically on the mobile advertising market.”
“The first full year results for online advertising in New Zealand are promising. A steady increase each quarter in Search and Directories advertising expenditure highlights the response from advertisers keen to benefit from the potential of this online medium. Going forward, we will be well positioned to recognise trends throughout the year, compare quarterly figures with those from previous years, and portray that insight to the market,” says Chris Perree, Partner, PwC
IAB Insight is based on revenue information gathered from over 30 media companies representing dozens of sites across New Zealand, and is the largest study of its kind undertaken in this country.
A copy of the full report is available for download from the IAB New Zealand website at http://www.iab.org.nz
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IAB |
PricewaterhouseCoopers |
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Mark Evans Lee Williams |
John Deane Chris Perree |
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