Most of us spend the better part of our day surfing it, and it’s always offered click through results that seemed to provide more accountability than anything print could offer, but the internet has taken its sweet time becoming an advertising power. We may finally be there, though, with IAB Australia once again posting big gains in online advertising expenditure.

In its first quarter Online Advertising Expenditure Report, compiled by PricewaterhouseCoopers (PwC), a 17% year-on-year growth was reported, amounting to a record setting $601 million online spend.

Search and directories did brilliantly, with a 23% growth year-on-year, while classifieds increased 19% year-on-year.  The general display market didn’t do so well year-on-year, however, recording just 3% growth. 

Search and directories now accounts for 54.2 percent of the overall online advertising expenditure, representing $326 million, with classified accounting for 24.2 percent ($145million) and display advertising recording 21.6 percent ($129million).

“Cyclically Q1 is always a cautious quarter from media agencies and their clients and down on Q4,” explains IAB Australia CEO Paul Fisher. We expect continued double digit growth in search and directories, classifieds and a return to double digit growth for general display in Q2 and it’s encouraging to see the strong growth in the display expenditure in the real estate, retail and health, beauty and pharmaceuticals industry categories.”

Fisher says online video advertising was a huge winner.

“Online video advertising continues to grow strongly, up 47 percent on Q1 2010,” he says, “which reflects the continued adoption of this format by advertisers looking to enhance or replace their TV schedules.”

Video based advertising maintained strong growth recording $8.44million for the first quarter, up from $5.7million in Q1 2010.  Email based advertising comprised $8.52million for the quarter, a slight increase from $7.9million in the corresponding quarter in 2010.  

Top display advertisers

Finance (down 4.61%)

Motor vehicles

Computers and Communications

Top classified advertisers

Real estate

Recruitment

Automotive

The 2011 IAB Online Advertising Expenditure Report covers more than 1,000 websites.  An executive summary of the Report is available on the IAB Australia website. The full report is made available to IAB Australia members only.