[SOUTH AFRICA] DoubleClick, the online advertising company, announced on Monday that more than 50 percent of the Fortune 100 companies advertise across its network, including notables like Motorola and General Motors.
DoubleClick’s share price has depreciated 90 percent since January 2000, giving the announcement a desperate edge. Understandably, DoubleClick has a vested interest in promoting online advertising, but they do offer some sound reasons for cautious optimism.
For one, the company has increased revenue from traditional advertisers by 173 percent since the 3rd quarter of 1999. And according to ad measurement firm, AdRelevance, the number of new companies advertising on the Internet rose by 153 percent in 2000.
Finally, the company states that while consumers spend 10 percent of their media consumption time on the Internet, companies only allocate 5 percent of their advertising budget to online advertising.
According to eMarketer, the worldwide spend on online advertising will be US $43 billion by 2005, compared to US $519 billion for offline advertising. In other words, online adspend will be 7.65 percent of the total spent on advertising worldwide. Up, but still below what it should be given the how much of their total media time consumers will spend on the Internet — a figure that is expected to continue to rise.
DoubleClick and other online advertisers have reason to smile, if they can make it through the current tough times without folding or being acquired by rivals with more substantial cash assets.
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