Published on Tuesday, October 23, 2007

Interactive ads growing much faster than predicted

No surprise that interactive advertising is growing. But there may be some shock over the numbers.

And the amount of money being set aside for interactive marketing will surge faster than many marketers have expected  --  hitting $61 billion by 2012, says Forrester Research Inc.

“Interactive advertising covers such things as display ads, search engine marketing, in-game advertising, e-mail marketing and mobile marketing,” says the Boston Business Journal.

The industry will boom from $18.4 billion in 2007 to more than $61.3 billion in 2012, the Forrester report projects.

In all, interactive marketing will come to represent 18% of all advertising, up from the current 8%, decreasing the percentage spent on traditional advertising.

"Right now is just a time when marketers have accepted that interactive is legitimate and here to stay," said Shar VonBoskirk, a principal analyst at Forrester and author of the report.

"Marketers have finally gotten to the place where they're better at distributing (ad) dollars across the channels their customers are using," she added.

That's good news for the Internet's power players, such as Google Inc. and Microsoft, and even for some of the fledgling startups making early moves into the space, says the newspaper. But it's not necessarily great for the traditional advertising models like television.

"Television will still be the largest line item on the ad budget," Ms VonBoskirk said. But though it may stay on top, TV will see its percentage of overall ad spending erode as marketers make room for the interactive space, she added.

Report by David Wilkening

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