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New Group Keeps Track Of Online Ad Revenue
By John Drinnan, The New Zealand Herald

New media are developing an industry standard for tracking internet advertising as the online sector joins the mainstream.

Online media companies formed the Interactive Advertising Bureau late last year from the Online Publishers Group.

The first priority is to set up an industry standard on how much advertising money is going online.
IAB chief executive Mark Evans says these are still pioneering days for the sector, whose growth here is rapid but appears to be lagging behind Australia.

How far behind may become clear with the new tracking system.

The IAB plans to establish the size of the online advertising market and provide a benchmark that allows individual online media to assess market share.

It will allow the local advertising industry to compare New Zealand with the 23 other countries that have their own IABs.

Evans estimates that the nine big players in the New Zealand IAB - Google, YahooXTRA, Fairfax Media, Vodafone, ACP, APN, TVNZ, Infego and Yellow Pages - will account for 80 per cent of all online ad revenue.

This would give the IAB a reliable base to judge the industry.

Evans said that while the Nielsen NetRatings system was accepted as the industry standard for tracking visits to websites, advertising agencies still did not have a reliable way of estimating advertising spend.

The IAB will collate figures and supply them to the ad industry body - the Advertising Standards Authority - which will publish them with figures supplied by other media such as newspapers, radio, television and magazines.

The first figures collated by the IAB are expected to be released by the ASA next month in its annual comparisons of ad spend in different media.

Australia's Audit Bureau of Verification Services issued figures last week showing that online advertising advertising had passed the A$1 billion mark and analysts expect online to make up 13 per cent of total advertising revenue this year.

The online spend in New Zealand for last year is expected to be above 4 per cent of total advertising, which is double the level of 2 per cent in 2005. That was about double the figure for 2004.

Internet advertising specialist John Schofield said there were so many websites with advertising revenue that trying to estimate the total was a nightmare.

And beyond banner ads and search engine advertising, ads will develop in many different ways including using mobile phones and even product placement.

Small websites which have ad revenues that don't amount to much individually could make a much bigger impact when their numbers are added together.

The IAB says the 4 per cent figure for online advertising doesn't reflect the true size of New Zealand's online ad market.

Advertising agencies are hoping the IAB will give them a clearer picture on the scale of online in this period of rapid transition in the media sector.

Advertising agency Total Media says a recent survey from ACNielsen estimates a growth rate of 11 per cent but managing director Martin Gillman believed 20 to 25 per cent this year would be more likely.