News24

Online ad spend overtakes newspapers

2010-12-21 12:20

Washington - Online advertising spending in the United States will overtake spending on newspaper ads this year for the first time, digital research firm eMarketer said on Monday.

EMarketer estimated that online ad spending will grow 13.9% in 2010 to $25.8bn while spending on print newspaper ads will drop 8.2% to $22.78bn.

Including internet ads, print and online newspaper advertising revenue will hit $25.7bn, eMarketer said, still below the $25.8bn advertisers will spend online.

"Marketers are devoting bigger shares of their budgets to digital media as they see more customers shifting time toward the Web," eMarketer chief executive Geoff Ramsey said in a blog post.

"It's something we've seen coming for a long time, but this is a tipping point," Ramsey said.

"The bad economy has actually accelerated the shift to digital advertising," Ramsey added. "Online ads -- especially search ads - are increasingly seen by many marketers as a more reliable bet than print ads, which are often difficult to tie to a measurable financial result."

EMarketer said total ad spending in the United States is expected to grow 3% in 2010 to $168.5bn.

EMarketer said print newspaper ad spending is expected to slide by 6% to $21.4bn in 2011 while online ad spending grows 10.5% to $28.5bn.

US newspapers have been grappling with declining print advertising revenue, eroding circulation and the migration of readers to free news on the Web, and online ad revenue growth has not kept pace with losses on the print side.