Online Ad Revenue Grows 38% Over 2006 levels, Quadruples Over Just
TORONTO, July 3 /CNW/ - The Interactive Advertising Bureau of Canada
(IAB) today announced that 2007 Canadian Online Advertising Revenues climbed
to just over $1.2 billion for the year - a 38% increase over 2006 actuals.
Publisher revenue from Online advertising in Canada has more than quadrupled
over the past five years - building from $237 million in 2003, to the
$1.2 billion mark in 2007 - and is quickly closing in on more established
mediums. Of the $1.2 billion, approximately $260 million or 21 percent of ad
revenue was received by French Canadian Online properties, representing
year-over-year growth consistent with the rest of the Canadian market.
In response to a variety of shifts in the industry (including a high
level of merger and acquisition activity in the Canadian media market, and the
continued penetration of Online Ad Networks into the Canadian Online
advertising space), IAB Canada's 2007 Revenue Survey process was revisited,
with the objective of assuring the elimination of any past and ongoing
duplication of ad revenue from these sources.
Canadian Online Publishers obviously had no difficulty in adjusting to
the revised ask, as IAB Canada's 2007 Canadian Online Advertising Survey
garnered a response rate of over 90% for companies with anticipated revenue of
over $5 million. "The industry can feel confident about all past and present
numbers," says Martin Lundie, Partner, Technology, Communications and
Entertainment Assurance and Advisory Business Services for Ernst & Young LLP
(who analyzes IAB Canada's Survey data), "Firstly, because the factors we
adjusted for in the 2007 Survey were not present prior to 2006; and secondly,
because of the extremely high response rate. Surveys with a high response rate
from respondents with the most significant size, provide a very high degree of
accuracy and reliability."
Publishers applied the improved methodology to both 2006 and 2007
numbers, and as a result, the actual Canadian Online Advertising Revenue for
2006 has been revised from $1.0 billion to $900 million, with all segments
revised accordingly below.
In actual millions of dollars, 2007 vs. 2006 Canadian Online Ad Revenue
by Advertising Vehicle, breaks down as follows:
2007 2006 %of 2007 %Change
---- ---- -------- -------
Total Spend (2006-07)
Display $432M $314M 35% +38%
Video $9M NA 1% NA
Search $478M $343M 38% +39%
Classifieds/Directories $305M $223M 25% +37%
Email $17M $20M 1% -15%
TOTAL $1241M $900M
2007 Canadian Online Ad Revenue by Advertiser Category was also tabulated,
and was as follows:
- Automotive - 16%;
- Media + Entertainment (Music, Film, TV) - 8%;
- Financial - 11%;
- Leisure (Travel, Hotel, Hospitality) - 7%;
- Packaged Goods - 6%;
- Retail - 9%;
- Technology - 10%;
- Telecommunications - 7%; and,
- Other - 26%.
IAB Canada's projected total for 2008 Online Advertising Revenue in
Canada is estimated to be $1.5 billion - a full 25% percent more than the 2007
actuals of $1.2 billion.
"The current and continued projected growth in Online advertising in
Canada speaks volumes about how important the medium has become to marketers
in terms of its ability to reach, target, engage and dialogue with consumers,"
says Paula Gignac, President, IAB Canada. "The sky's really the limit for
Online, as new developments in targeting technology, creative (it's great to
have our first Video advertising revenue number), and integrated strategies
are happening on an almost daily basis - all with the goal of helping
marketers capitalize on Online's ever-growing and engaged audience. Online
advertising is no longer below the line in any way - it's now an essential
component of any marketing mix."
And while Online Advertising is growing at an enviable pace compared to
advertising growth in other media in Canada, the industry is not without its
challenges. "When asked to identify possible business constraints for 2008,
Publisher respondents to IAB Canada's Survey identified hiring and retaining
qualified staff, as well as the current economic climate, as the two biggest
challenges they will grapple with for the remainder of the year," says Martin
Lundie, Ernst & Young LLP. "The industry has indeed been resource-challenged
as a result of its own success," says Paula Gignac, President, IAB Canada. "In
response, IAB Canada has developed a robust strategy to educate, attract and
retain talent within the industry as we go forward. To date, over 2500
professionals across various media and advertising sectors have been educated
via IAB Canada Courses in Interactive Marketing + Online Advertising and
Social Media Marketing; the organization is actively assisting its members
with both off- and Online recruiting initiatives; and, has recently embarked
on a Digital Salary Survey in association with Marketing Magazine, designed to
help HR departments within Publisher, Agency and Advertiser operations
determine the proper compensation for their most-advertised positions."
"As far as the economy is concerned, I think Canadian Online Publishers
are being appropriately prudent in identifying this as an important factor to
monitor in 2008. But, if U.S. Online advertising results for the last two
quarters of 2007 and first quarter of 2008 are any indication, Online
advertising's inherent accountability is a strength that becomes even more
valuable to marketers in the midst of troubled economic times. South of the
border, Internet advertising is still growing at a record pace - despite a
prolonged economic downturn - so, we would expect Online advertising in Canada
to show the same sort of resiliency, should any prolonged economic dip
materialize here as well."
About IAB Canada's 2007-08 Canadian Internet Advertising Revenue Report
The 2007 Canadian Internet Advertising Revenue and the 2008 estimated
Canadian Internet Advertising Revenue were reached after a comprehensive
survey of all major Online Publishers in Canada. Revenue data was compiled and
analyzed by Ernst & Young LLP.
A more comprehensive analysis of IAB Canada's 2007-08 Canadian Online
Advertising Survey results, along with an updated description of the Revenue
Survey methodology, will be published by IAB Canada and Ernst & Young LLP in
For more information about the IAB Canada 2007-08 Canadian Internet
Advertising Revenue Report visit www.iabcanada.com.
The Interactive Advertising Bureau of Canada (www.iabcanada.com), is the
national voice and de facto thought leader of the Canadian Interactive
marketing and advertising industry, and is a not-for-profit association
representing a membership composed of Advertisers, Agencies, Publishers and
Interactive Service Associates.
For further information:
For further information: Paula Gignac, President, IAB Canada, (416)
598-3400 (ext. 26), IABCANADA.COM