Ad Spending in Top Web Categories Up 86 Percent

The top 25 industry categories increased their Internet ad spending 86.7
percent for
the first three quarters of 1998, compared to the same period in 1997,
according to a new report.

InterMedia Advertising
(IAS) InterWatch report said that computers and software (including
online and Internet services) continue to lead all industries in spending,
accounting for nearly half of all Internet advertising (47.3 percent at $321.6
million); however, the category ranks only 20th in growth at 64 percent.

Dramatic growth is seen in categories such as medicines (up 403%), government
and organizations (up 351.9%), direct response companies (up 273.9%), retail
(up 163%) and financial (up 127.8%), the report said.

Over 400 industry categories are tracked by the InterWatch report. InterWatch
also monitors Internet spending as part of overall advertising expenditures.
Among the approximately 300 Web sites tracked, the top 50 sites accounted for
more than $636.5 million in revenue through the first nine months of 1998, a
growth of 90.5 percent over 1997. The Internet Advertising Report recently
said that
spending on online ads will approach $2 billion for all of 1998.

“We know that computers and software continue to be major players, but what
we are seeing is that many other
industries have discovered the importance of this medium,” said Joe
Philport, president of IAS. “Advertisers in these
industries are now using the Internet as an essential vehicle for implementing
their marketing strategies.”

Following computers and software in ad spending, the financial industry
represented 8.8 percent of the dollars spent on the Internet at $59.9
million. Direct
response companies jumped to $47.3 million with 7 percent, followed by the
media and
advertising category in fourth at $35.2 million, with 5.2 percent. Local
services and
amusements were closely behind in fifth at $33.2 million with 4.9 percent
of Internet
ad expenditures through the first three quarters of 1998.

The Internet now represents 1.5 percent of overall ad budgets, the report
said. For
the full year
of 1997 the Internet claimed .74 percent. Microsoft was the top spender on the
Internet through the first nine months of 1998 at $25.5 million, up 7.8
percent over
1997. IBM is closing the gap at $21 million, a 77 percent increase. Excite
was third
at $8.8 million, followed
closely by General Motors up 111.8 percent to $8.2 million.

InterMedia Advertising Solutions was formed to monitor and provide industry
detail on advertising placement and expenditures on the Internet. The
information is delivered using the industry standards developed by IAS’ sister
company, Competitive Media Reporting (CMR).

CMR provides
strategic advertising intelligence to advertising agencies, advertisers,
broadcasters and publishers. CMR and IAS are VNU Marketing Information
Services companies.

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