Online Advertising To Reach $18.9 B In 2010.

JupiterResearch released its 2005 Online Advertising Forecast today at the Search Engine Strategies Conference & Expo 2005. The forecast reveals that online advertising will continue steady growth over the next five years, eventually reaching $18.9 billion in 2010, compared to $9.3 billion at the end of 2004. This growth reflects not only advertiser confidence in the medium, but also the strength of advertising on search engines in 2010. Search engine advertising will generate more revenue than standard display advertising by 2010.

Compound annual growth rates tell the story: display will grow at 7% and search will grow at over 12% over the next five years. “There is phenomenal momentum behind search engine advertising,” stated JupiterResearch Senior Analyst Gary Stein. “The number of advertisers using search to market products continues to grow, as does the overall efficiency of the market- search engines are getting even better at making money off search engine results pages,” added Stein.

The rise of search engine marketing, however, is only one element of an overall growing online advertising market. Other areas will also experience sustained growth over the next several years. Classified advertising will grow at nearly 10%, reaching $4.1 billion in 2010. Advertisers will also take great advantage of the growing number of broadband-connected households to field rich and streaming media advertisements. Rich media spending will grow at a 25% compound annual growth rate (to $3.5 billion) and streaming media will grow at a 30% compound annual growth rate (to $943 million) by 2010.

Publishers will see revenue grow from several sources, including direct sales and network revenue-share deals. This year, the revenue of ads priced on a performance basis will surpass that of ads sold on an impression basis. Much of this performance inventory will come from network providers, which are increasing their use of targeting technology to provide better results for publishers. “Publishers are in a good position right now,” noted JupiterResearch VP and Research Director David Card. “Not only can they monetize their non-premium inventory, but they can strategically choose the network providers they feel can generate the most yield from that inventory,” added Card.

For more information at Http://www.jupitermedia.com