Online advertising tops £4bn

About £1 in every £4 spent by UK advertisers last year was spent on digital ads, according to a report.

The total internet advertising market grew 12.8% to a record £4.1bn, according to the Internet Advertising Bureau and PwC’s biannual advertising spend study.

Spend on social media ads increased by 200% in 2010, boosting the online display market by 27.5% on a like-for-like basis to another record £945m. Social networking sites now account for a quarter of the time spent online in the UK.

The availability of faster broadband in homes has driven video advertising, which grew 91% year on year to £54m.

IAB chief executive officer Guy Phillipson says: “The power of online to build brands is clearly reflected in the spectacular growth of display, thanks to the popularity of social media and video formats.”

Mobile advertising also increased by 116% year on year to £83m, up from 32% in 2009, although the growth has come from a low base.

Finance was the top-spending sector in online display last year with a 15.2% share of the market. The IAB says this indicates that as the economy recovers, finance brands are regaining their marketing spend.

Entertainment and media accounted for 14% of UK online display advertising in the second half of last year, while consumer goods manufacturers increased share to 13%.

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