Internet Display Advertising Falters in Q1

In the first quarter of 2008, the growth in spending on Internet display advertising slowed to 8.5 percent from 16.7 percent growth last year, according to estimates put out today by TNS Media Intelligence. Even with the slowdown, Internet ad spending still grew faster than that for TV (1.7 percent), magazines (0.8 percent), newspapers (-5.2 percent), radio (-4.5 percent), and outdoor (2.5 percent). The overall growth of all advertising spending that TNS measures was flat at 0.6 percent growth over the first quarter of 2007.

TNS’s Internet numbers do not include search advertising, only display ads. The quarterly total for all Internet advertising is closer to $6 billion. But this data point is evidence that the Web may not be immune to weakness in advertising spending overall. If the industry dives into a full-blown advertising recession, many Web companies could feel the impact.

This year, TNS only provided the percentage changes. Since it provided absolute dollar values last year, I did my own math and put together the table below. In the first quarter of 2008, $2.9 billion was spent on Internet display ads in the U.S., representing an 8.3 percent share of the $35.1 billion total. That puts Internet display advertising ahead of radio ($2.2 billion), but behind newspapers ($6.0 billion), magazines ($6.8 billion), and TV ($15.9 billion). My figures are rounded, and the percent changes are year-over-year.

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