Web Ad Spend To Outstrip TV Starting This Year: Forecast

Sweden will this year become the first country where internet ad spending will surpass that given over to TV ads, according to the This Year, Next Year 2008 forecast from WPP’s heavyweight Group M ad buying agency, released quietly last month. The UK will fall just short of the same watershed this year, finishing 2008 with online accounting for 24.8 percent of ad spend, just shy of the 26 gobbled up by TV (in Sweden, it will be 19.5 percent to the web, 19.2 percent to TV). But online will overtake telly in Britain and Denmark early in ’09, the group predicts.

Report author Adam Smith: “The UK is a special case. Its TV share is depressed by the BBC and there is still a large and healthy print sector, and Britons are among the world’s heaviest internet users.” So Group M is expecting UK 2008 online ad spend to grow 30.8 percent to £3.4 billion – much faster than a projected one percent growth in TV spend. Via Guardian.

The Internet Advertising Bureau has not yet released full 2007 figures (they are due in April), but in the first half of the year the surge in web ad spending matched growth seen throughout the whole of 2006. UK web spend already overtook that given to national newspapers, back at the end of 2006. Google’s (NSDQ: GOOG) ad revenue overtook Channel 4’s in the same year and surpassed that of ITV1 in the third quarter of 2007, according to a back-of-the-envelope calculation carried out by The Times.

Globally, Group M forecasts online will account for over 10 percent of ad spend for the first time, with search-based ads comprising 65 to 70 percent of that – double its 2005 prevalence.