A recent article published on the Ofcom website shows just how much is now spent on Internet Advertising. Nearly 30% of advertising spend in the UK is on internet advertising

A major trend in advertising markets in recent years has been the growth of spend on the internet (Figure 5.8). In 2005, internet spend accounted for less than 10% of total advertising spend in all our comparator countries, but by 2010 online spend accounted for more than 15% in most countries, and approached 30% in the UK.

The UK continues to have the greatest internet share of total advertising spend (28.7%), followed by the Netherlands (25.2%) and Sweden (23.4%). Reasons for this include high internet take-up in these countries and, in the UK in particular, widespread take-up of online shopping, which is driven by high levels of credit card take-up, high levels of trust in online payments, a previous history of catalogue shopping and the early launch of major online shopping services (Amazon.co.uk launched in 1998, for example, following the purchase of bookpages.co.uk). More information on internet shopping is provided in Section 5.3.4 below.

Ireland’s internet advertising market has the smallest share of total advertising among our comparator countries (8.6%), although this may be in part be explained by some advertising being administered in the UK, followed by Italy (11.4%) and Spain (13.9%).

Between 2004 and 2009 the proportion of all advertising spend allocated to internet campaigns has steadily grown. However, in 2010 this growth slowed in some European markets. In Sweden and France the internet’s share of total advertising expenditure remained almost constant (up by 0.3 percentage points in both countries) and in Poland the share of internet advertising fell by 0.6 percentage points.

Slower growth in share is not a reflection of a slowing internet advertising market but reflects a recovery in the total advertising market. In 2009 total advertising spend in all comparator countries fell, while internet advertising spend continued to grow in most countries (France and the US were the exceptions, with internet advertising spend falling by 3.3% in each country in 2009). In 2010, total advertising spend recovered and exceeded 2009 spend in all comparator countries except Ireland. In Australia and Poland strong growth exceeded even the peak spend in 2008. Internet advertising also benefited from a recovery in growth, but in Sweden and France at a similar rate to the total advertising market, and in Poland at a slower rate than the total advertising market.

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