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3Q Online Adspend Up; 4Q Looks Good, 2006 Even Better

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Online adspend increased some 10 percent in the third quarter according to a Deutsche Bank/MediaPost survey of 87 media executives questioned this month about their clients' use of online advertising in the third quarter and their expectations for the fourth quarter, writes MediaPost. Price increased both for search and for display ads, including on run-of-network sites, as "rising demand levels coupled with supply constraints for premium inventory appear to be giving publishers pricing power," according to the study.

Some 74 percent of the executives said client spending increased from the second quarter, and 25 percent reported no change. The weighted average for the reported spending increases came to 10 percent. Adspend increases are expected in the fourth quarter as well, with the weighted average calculated at 9 percent.

Nearly 60 percent of executives reported paying more for cost-per-click ads in the third quarter than in the second: Weighted growth came to 5 percent for the quarter. For display ads, premium inventory prices increased some 7 percent for the quarter, on a weighted average basis. The average weighted growth of run-of-network inventory prices was 3 percent.

About 84 percent of respondents said they expected growth to be greater in 2006 than the 26 percent increase reported by the Interactive Advertising Bureau for 1H05.

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