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Online Ad Prices Likely to Rise in '07


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With the continued increase in the reliability of online advertising and the ability to track online ads, don't be surprised to see that ratecard be a tad pricier next year.

Online advertising revenues are expected to grow 31 percent, to $16.4 billion, in 2007, accounting for 6 percent of the overal ad market, according to eMarketer, writes the New York Times. Some of that growth will come from higher prices, but likely much of it will be due to a larger share of ad budgets shifting to online.

"Rates are going up, but effectiveness is going up too," Greg Stuart, chief executive of the Interactive Advertising Bureau said, suggesting consumers were now more likely to make a purchase or request additional information than in previous years.

While ads served to specific target audiences are fetching heftier prices - like MSN's new Men's Lifestyle section - prices are dropping on general interest websites, invitingĀ broad-based advertisers like LowerMyBills.com and its eye-catching banner ads. Video-sharing sites are also seeing, for now, an inventory surplus, and therefore lower prices.

"Every marketer I've spoken with is saying that in the next calendar year they'll increase their budgets by 15 to 30 percent, even the CPGs," said Joanne Bradford, MSN's corporate vice president and chief media officer. "If they spend even close to that, we'll all have a great Christmas next year."

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