Dot-Coms Still Dominant Online Advertisers

Traditional companies may be paying more attention to online advertising, but they have long way to go to equal dot-com advertisers when it comes to actually placing an ad online. Dot-coms outnumber traditional advertisers online two to one, according to a report by AdRelevance.

Key findings from the AdRelevance Special Report, which analyzes the Top 200 online advertisers from the second quarter of 2000 and compares dot-com companies to traditional businesses, include:

  • The percentage of dot-com advertisers in the Top 200 rankings increased from 54 percent in July 1999 to 68 percent in June 2000.
  • Dot-com companies are committing a greater percentage of online ad impressions: 108 dot-coms committed 64 percent of the Top 200’s ad impressions in July 1999; while, in June 2000, 138 dot-coms committed 75 percent of the impressions.
  • While dot-com advertisers outnumber traditional advertisers when looking at all industries combined, the story is not quite the same when the trend is examined across individual industries: Web media, retail and business-to-business industries are dominated by dot-com advertisers, with 85 percent, 74 percent, and 61 percent of the Top 200 online advertisers being dot-coms, respectively. Traditional advertisers, however, populate travel (76 percent), software (84 percent), hardware and electronics (97 percent), and consumer goods (97 percent) industries.


Dot-Com Advertisers and Impressions by Industry
Industry Percent of Dot-Com
Advertisers
Percent of Dot-Com
Impressions
Web Media 85% 91%
Retail 74% 74%
B-to-B 61% 74%
Entertainment 57% 52%
Telecommunications 46% 69%
Financial Services 41% 63%
Travel 24% 80%
Software 16% 86%
Automotive 10% 15%
Hardware/Electronics 3% 23%
Consumer Goods 3% 2%
Source: AdRelevance

“With the market’s recent performance and the increased pressure for dot-coms to turn profits, it’s interesting to see that the clear majority of the AdRelevance Top 200 Online Advertisers are dot-com companies. According to the latest AdRelevance data, dot-com advertisers account for 68 percent of companies and 77 percent of ad impressions among the Top 200 Online Advertisers,” said Charlie Buchwalter, VP of media research for the AdRelevance division of Media Metrix. “When compared to traditional advertisers, the average dot-com appears to be spending more aggressively, typically even outspending traditional advertisers.”

While dot-com advertisers might not account for the majority of companies advertising online in some industries, the companies in the Top 200 dominate ad spending in some instances. For example, although only 32 of the Top 200 software advertisers are dot-coms, they account for 86 percent of all impressions within the software industry Web sites. Similarly, 48 of the Top 200 travel companies are dot-coms and account for 80 percent of all travel advertising impressions placed by the Top 200 travel advertisers.

“Despite the overall dominance of dot-com advertisers, traditional advertisers have managed to stake a claim in some industries,” Buchwalter said. “There’s no doubt in my mind that as traditional businesses become more comfortable with online advertising, they will begin to spend more of their budgets on the Internet — in fact that’s probably the next wave we’ll see hit the online ad industry. But, until that day comes, dot-coms are in the driver’s seat.”


Share of Impressions by Industry, Q2 2000
Industry Share of
Impressions
Share of
Top 200
Difference
Web Media 37.1% 42.5% 5.4%
Financial Services 15.3% 18.7% 3.4%
Software 2.9% 4.1% 1.2%
Hardware/Electronics 1.9% 1.3% -0.6%
Travel 3.1% 2.3% -0.8%
Automotive 1.3% 0.4% -0.9%
Entertainment 2.2% 1.2% -1.0%
Telecommunications 4.0% 2.8% -1.2%
Retail 22.7% 21.3% -1.4%
B-to-B 6.5% 5.0% -1.5%
Consumer Goods 2.7% 0.3% -2.4%
Source: AdRelevance

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