Canadian online advertising revenue grows to $1.6b, surpasses radio

IAB Canada Newsletters - The Interactive Advertising Bureau of Canada (IAB) today announced that Canadian Online Advertising Revenues exceeded budgeted expectations of $1.5 billion, and grew by 29% in 2008 to just over $1.6 billion.

Publisher revenue from Online advertising in Canada has more than quadrupled over the past five years -- building from $364 million in 2004 to the $1.6 billion mark in 2008 -- surpassing 2008 Radio revenues of $1.55 billion in the process.

Online Advertising now occupies third spot in terms of both time spent by consumers with media, as well as marketing spend by Advertisers, representing a full 11% of the combined $14 billion spent on all major media in Canada (TV, Newspapers, Internet, Radio, Magazines and Out Of Home).

Of the $1.6 billion, approximately $317 million or 20% of Online ad revenue was received by French Canadian Online publishing properties, representing year-over-year growth of 22%.

Search advertising (at 38% of total revenues), continues to lead in terms of share of dollars, followed by Display at 31%, and Classifieds at 30%. Online Video advertising grew by 33% from its relatively small base of $9 million in 2007 to $12 million in 2008, while Email advertising stayed stable at approximately $18 million.

2008 Canadian Online Ad Revenue by Advertiser Category was also tabulated, and was as follows:

# Automotive - 13%;
# Financial - 11%;
# Technology - 10%;
# Telecommunications - 9%;
# Packaged Goods - 8%;
# Media + Entertainment (Music, Film, TV) - 6%;
# Leisure (Travel, Hotel, Hospitality) - 6%;
# Retail - 5%; and,
# Other - 32%. Publishers within IAB Canada’s Annual Revenue Survey have projected that their revenues will continue to grow at an enviable pace, with Online Advertising Revenue in Canada estimated to be $1.75 billion in 2009, or 9.2% more than the 2008 actuals. This forecast includes a 7.8% increase to $342 million for French Publishers’ Online advertising revenue.

“Even in the face of uncertain economic conditions and continued pressure on total advertising budgets, clearly, Online advertising has cemented itself as a mainstay in the overall media buy,” says Paula Gignac, President, IAB Canada. “And although 2009 has presented substantial challenges to the entire Canadian marketing community, we’re confident that Online advertising will continue to grow at the projected pace, for the simple reason that as the Internet continues to engage and delight consumers, it matches these accomplishments with a persistent ability to deliver measureable Advertiser results.”

Download the Detailed IAB Canada 2008 Actuals/2009 Budgeted Internet Advertising Revenue Report.