The Australian online classifieds advertising market grew by only 2.5% in 2009 to finish the calendar year valued at $506 million, a report from Frost & Sullivan has indicated.
This represents a stark decrease in growth when compared to the 2008’s figure of 28%, with the report, entitled ‘Australia Online Classifieds Advertising Market 2010’, demonstrating the marked impact of the global financial crisis on the local advertising sector.
However, the migration of classifieds advertising expenditure to the online channel has continued, with online now accounting for an estimated 25% of total classifieds advertising expenditure, up from 23% in 2008.
According to the report, growth in online classifieds advertising is likely to taper off over the next three years reaching $762 million by 2013 as the market reaches a higher state of maturity and social media tools provide organisations with an alternative medium to reaching target markets.
“As the Australian online classifieds market matures, it is, like the print classifieds market, becoming more closely correlated with economic conditions,” said Phil Harpur, senior research manager at Frost & Sullivan.
Of the three key online classified sectors: real estate, employment and automotive, employment was the worst hit by the economic slowdown with revenue falling 21% for the calendar year 2009.
The real estate and automotive sectors were less affected, with annual growth rates for 2009 of 24% and 22% respectively.
The report found that the most significant competitive development in real estate online classifieds advertising has been the launch on Google Maps of real estate listings, which presents a challenge to established online real estate publishers.
“As select sectors in the online classifieds market, such as the recruitment sector, have established themselves as more popular than print, both companies and consumers are questioning whether they also need to advertise on the print channel at all,” Harpur added.