Web ad sales booming

Total spending for online advertising totaled $157.4 million in the first nine months of 1996, according to a new survey.

CNET News staff
2 min read
NEW YORK--Total spending for online advertising totaled $157.4 million in the first nine months of 1996, according to a report from the Internet Advertising Bureau, a new trade association for ad-supported online media.

The ad spending figure is based on reports submitted anonymously by Web sites, online services, and ad-supported email services to Big Six accounting firm Coopers & Lybrand.

"Web advertising is far from dead," said IAB acting chairman Rich LeFurgy, vice president of sales for Starwave. "The death of the banner has been widely exaggerated. Ninety percent of what's going on is banners."

The IAB figures are higher than numbers reported this fall by new media consulting firm Jupiter Communications. LeFurgy attributed the discrepancy to the fact that IAB included online services, email services, and "push" media such as PointCast, which uses a Net connection to display news and ads as screen savers on users' PCs.

The IAB-Coopers & Lybrand survey found that advertisers spent $29.9 million in the first quarter of 1996, $51.9 million in the second, and $75.6 million in the third. LeFurgy said an informal check with major Web sites found spending in the final three months of the year "dramatically above the third quarter."

Those spending figures include the value of "barter" ads--when two Web publishers run each other's ads for free. They also count "gross commissionable" ads, and the online portion of ad packages placed in multiple media with publishers that have both online media and traditional print or electronic form.

Actual reported figures accounted for 85 percent of IAB's numbers; the remaining 15 percent of the total was estimated based on the knowledge of which publishers had not submitted numbers to the survey. The survey was based on more than 200 Web sites and services that generate at least $5,000 a month in advertising.

The survey will report quarterly on online ad spending. Publishers have until the end of January to submit their fourth-quarter ad revenues.