Online Travel Ads Surge

Even in the face of a slowdown in air travel due to terrorist fears and the sluggish economy, the online advertising industry continued to pull in travel business, according to new research by Nielsen//NetRatings .

In the third quarter, the researcher’s AdRelevance unit found that online travel was the fourth-largest sector of online advertiser, buying just fewer than 16 million impressions, up 39 percent from a year ago.

“The instantaneous nature of the Internet helped change the travel industry, with consumers benefiting from special, online-only promotions and last-minute deals,” said Charles Buchwalter, an analyst with Nielsen/NetRatings. “Time-sensitive online advertising strategies, such as one-day fare sales, have been tremendously successful and the Internet is the only medium able to garner such immediate results.”

Most of the Net advertising came from booking sites, with Travelocity parent company Sabre leading the way with 4.2 million impressions. Expedia and Hotels.com parent company USA Interactive came in second with 2.5 million impressions, while Orbitz was third with 1.3 million impressions.

Recently, the New York Times Digital reported that travel was its third highest-generating source of ad revenue in the third quarter, trailing only technology and finance.

The woes affecting the airlines have not held back the migration of travel planning from offline to online. The industry got a potential further boost last week, when the federal Department of Transportation proposed revisions to the regulations governing the industry’s computer reservation system.

According to Jupiter Research, which is owned by the parent company of this publication, 19 million U.S. consumers accounted for $27 billion in online travel bookings last year. By 2007, Jupiter figures that will grow to $64 billion.

Despite the impressive gains, the air travel industry has not fully embraced the online medium for advertising. Outside of the Internet booking sites, the top advertiser was not even an airline — it was Dollar Thrifty, which took out 625,000 impressions in the quarter. Instead, the top airline advertiser was British Airways, which ranked No. 7 with 478,000.

And the sector itself continues to lag behind the top advertisers on the Internet.

In the third quarter, the travel industry accounted for just 6 percent of online ad impressions, less than half those for Web media and far behind the financial services and retail industries.

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