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Online advertising market grows 15.4% in Europe
Display advertising was the main growth drive across the region, with a global 21.1% year-to-year increase in 2010. All European online advertising markets experienced growth, with 5 key markets reaching the billion mark, and 6 countries where the online advertising expenditure accounted for more than 20% of the total. The market has never ceased to grow, and even if the economic climate slowed that growth to 4.5% in 2009, in 2010 it was back to double-figures, as advertisers put their confidence (and budgets) in digital channels.
- The IAB AdEx 2010 report is published by the Interactive Advertising Bureau, a global network of digital advertising and marketing associations, of which some Experian companies are members. More information in http://www.iabeurope.eu
Emergent markets: high growth, but still a small part of the overall European market
Emerging countries, like Russia, Turkey or, to a lesser extent, Romania, are experiencing the highest growth. Russia led the group with 37.1% year-to-year growth. Turkey followed closely, and grew 29.6% in 2010. With the exception of Russia, these and other countries form a group of small, high year-per-year growth markets. They represent a smaller portion of the overall European online advertising market, but their high growth means that even if they have started late in the race, they are quickly catching up with other established, bigger markets.
Established markets are consolidating its share of the overall advertising budget
There are 6 markets in Europe where online advertising accounts for more than 20% of the overall advertising market. These are UK, Denmark, Norway, Netherlands, Sweden and the Czech Republic. Germany is very close, with 19.8%, while in Poland, Finland, France, Turkey and Spain, the weight of digital advertising is around the 15% mark, so there’s still space for more growth in the coming years.
To understand the explosive growth of digital advertising in Europe we can just compare these figures with those of 2006. At that time online marketing represented 11% of the total advertising budget in the UK, and 4% in Spain. Now, in those countries, the online channel represents 29% and 14% of total advertising expenditure.
Even if these countries have already well-established online advertising industries, their growth rates are still higher than 13%. France was the only country that didn’t see year-to-year double-digits growth, with just 7%.
The comparison with the US: growing at the same rate
We’ve always looked up to the US when discussing the state of the online market and digital advertising. We may have to start thinking about comparing with them as equals. Between 2009 and 2010, US and European online advertising grew at the same rate and the gap between both markets has stabilized at almost €2 billion. This gap will reduce even further in the future as the emerging markets in Europe continue developing their online advertising industries, and more consumers get reliable, high-speed internet access.
Display advertising was the main driver of growth
While search is still the biggest online advertising sector in Europe, with 45% of the total investment, it was display advertising that led the growth in the region, with a 21.1% increase, in emerging and established markets alike.
Part of the blame for this is the investment in new channels and formats. Spend in video advertising grew 400% in Norway, while mobile advertising experienced a 166% growth in Spain.
Resilience in an adverse climate
Even in the current economic climate there are economic sectors that are blooming and continue to find opportunities for growth. As companies continue to make the shift from analog to digital advertising, mirroring the shift in western countries to a digital economy, we will continue to see the online advertising market grow.