Table of Contents
Scope and Themes
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- What you need to know
- Definition
- Data sources
- Sales data
- Consumer data
- Abbreviations and terms
- Abbreviations
- Terms
Executive Summary
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- The market
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- Figure 1: Fan chart forecast of U.S. total internet advertising sales, 2006-16
- Search dominates
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- Figure 2: U.S. online advertising spend, by type of ad, 2010-11
- Market factors
- Rapid gains in share from television and print
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- Figure 3: U.S. advertising expenditures, by media format, 2010-11
- PC penetration halts, but internet access universal among younger ages
- Mobile perfect outlet for reaching young and high-income consumers
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- Figure 4: Smartphone ownership, by age, February 2012
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- Figure 5: Cell phone features used in past 30 days, by household income, April 2011-November 2011
- Online and mobile shopping sales climbing, driving search ads
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- Figure 6: Fan chart forecast of U.S. total online and mobile shopping sales, 2006-16
- Figure 7: U.S. smartphone shopping sales, at current prices, 2009-15
- Internet radio shows dramatic gains
- The consumer
- Women, higher-income consumers more likely to regularly research and shop online
- Mobile ads still in early adoption phase
- PC ads have greater reach with younger internet users
- Relevancy remains a critical problem
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- Figure 8: Relevancy of ads seen, by age, March 2012
- Relevancy driven by regularity of online research
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- Figure 9: Relevancy of ads, by number of products researched online in past week, March 2012
- One in four clicked on search ad in last product research session
- Email ads still drive sales
- Asians and whites more likely to regularly research and buy online
- Teens and kids click on ads, demonstrate pester power
- What we think
Issues in the Market
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- Does anyone want to see ads?
- Why is relevancy still a problem?
- Will inventory remain a problem?
Inspire Insights
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- Inspire Insight: Make It Mine
- Inspire Insight: Attention Economy
Insights and Opportunities
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- Reaching a young, affluent audience
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- Figure 10: Number of computers owned at home, by household income, April 2011-November 2011
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- Figure 11: Time spent online on activities other than email at home and work, by household income, April 2011-November 2011
- Figure 12: Smartphone ownership, by household income, February 2012
- Younger and more affluent shifting from traditional media to internet content
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- Figure 13: Impact of internet on lifestyle, by age, April 2011-November 2011
- Figure 14: Impact of internet on lifestyle, by household income, April 2011-November 2011
- Targeting higher-income households with the iOS and Windows Mobile
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- Figure 15: Mobile OS ownership and intent to own, by household income, February 2012
- Advertainment
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- Figure 16: Increase in preference for ads that entertain, April 2009-November 2011
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- Figure 17: Preference for ads that entertain, by age, April 2011-November 2011
- Figure 18: Preference for ads that entertain, by household income, April 2011-November 2011
- Getting local with mobile
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- Figure 19: Attitudes to internet usage, by age, April 2011-November 2011
- Figure 20: Attitudes to internet usage, by household income, April 2011-November 2011
Market Size and Forecast
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- Key points
- Rapid growth
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- Figure 21: U.S. total internet ad sales, at current prices, 2006-16
- Figure 22: U.S. total internet ad sales, at inflation-adjusted prices, 2006-16
- Fan chart forecast
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- Figure 23: Fan chart forecast of U.S. total internet advertising sales, 2006-16
Market Drivers: Increasing Internet Usage
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- Key points
- PC penetration comes to a standstill
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- Figure 24: Trends in personal PC ownership, 2009-11
- Fixed-point internet access
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- Figure 25: Trends in internet access at home, 2010-11
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- Figure 26: Any access and at-home access to the internet, by age, April 2011-November 2011
- Figure 27: Any access and at-home access to the internet, by household income, April 2011-November 2011
- Home broadband
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- Figure 28: Broadband access at home vs. at work, in online sample, December 2011
- Access to mobile internet
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- Figure 29: Trends in web browsing on cell phone, in past 30 days, April 2009-November 2011
- Figure 30: Cell phone features used in past 30 days, by age, April 2011-November 2011
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- Figure 31: Cell phone features used in past 30 days, by household income, April 2011-November 2011
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- Figure 32: Access to 3G or 4G mobile internet on cell phone or tablet, by age, December 2011
- Increasing use of websites
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- Figure 33: Trends in use of the internet, in past 30 days, April 2010-November 2011
- Increasing amounts of time spent online
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- Figure 34: Trends in time spent online in past seven days on activities other than email, April 2010-December 2010 vs. April 2011-November 2011
- Increasing use of specific activities
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- Figure 35: Trends in the impact of the internet on lifestyle, April 2009-November 2011
Market Drivers: Online and Mobile Shopping
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- Key points
- Increasing online sales
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- Figure 36: U.S. total online and mobile shopping sales, at current prices, 2006-16
- Increasing mobile sales
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- Figure 37: U.S. smartphone shopping sales*, at current prices, 2006-15
- Online shopping and research cross age and income groups
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- Figure 38: Types of online research and shopping done in past 30 days, by age, April 2011-November 2011
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- Figure 39: Types of online research and shopping done in past 30 days, by gender, April 2011-November 2011
- Figure 40: Types of online research and shopping done in past 30 days, by household income, April 2011-November 2011
Competitive Context
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- Key points
- Online beginning to get its due
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- Figure 41: U.S. advertising expenditures, by media format, 2010-11
Market Segmentation
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- Key points
- Search leads and keeps gaining
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- Figure 42: U.S. online advertising spend, by type of ad, 2010-11
- Mobile ad sales
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- Figure 43: U.S. mobile ad sales, at current prices, 2010-16
- Figure 44: U.S. mobile advertising spend, by media segment, 2012-16
- Retailers top segment by sector
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- Figure 45: U.S. online advertising spend, by sector, 2010-11
Innovations and Innovators
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- DigitalTown gets local
- Vicks chases the flu
- Rovi capitalizes on smart TVs
- Local photo business limits costs through focusing on niche
- Levi’s premieres ad on Facebook before moving to traditional media
- shopkick rewards ad watching
Exposure
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- Key points
- Mobile ads still for early adopters
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- Figure 46: Types of ad seen in past month on PC, tablet, or phone, March 2012
- Vast interest in local mobile couponing
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- Figure 47: Interest in mobile couponing, by gender, April 2012
- Figure 48: Interest in mobile couponing, by household income, April 2012
- Reach for ads on combined platforms greatest for 18-24s
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- Figure 49: Types of ad seen in past month on a PC, tablet, or phone, by age, March 2012
- PC ad exposure trends with age
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- Figure 50: Types of ad seen in past month on PC, by age, March 2012
- Figure 51: Personal PC penetration, by age, February-September 2011
- Number of PCs per household
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- Figure 52: Number of computers owned at home, by age, April 2011-November 2011
- Figure 53: Types of computers owned, desktop vs. laptop, by age, April 2011-November 2011
- Ads in apps offer twice the reach of mobile web ads
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- Figure 54: Types of ad seen in past month on a cell phone, by age, March 2012
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- Figure 55: Smartphone ownership, by age, February 2012
- Limited exposure for tablet ads
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- Figure 56: Types of ad seen in past month on a tablet, by age, March 2012
- Figure 57: Tablet penetration in online sample, by age, December 2011
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- Figure 58: Types of ad seen in past month on a tablet, by household income, March 2012
- Those aged <35 to retain highest levels of mobile exposure looking forward
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- Figure 59: Planned acquisition in next month of first smartphone, tablet, or PC, by age, December 2011
Relevancy of Ads Seen
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- Key points
- Relevancy limited
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- Figure 60: Relevancy of ads seen, by type of ad, March 2012
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- Figure 61: Relevancy of ads seen, by type of ad, by age, March 2012
- Research drives relevancy
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- Figure 62: Number of products or services researched online in the past week, by age, March 2012
- Figure 63: Relevancy of ads, by number of products researched online in the past week, March 2012
The Research Process
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- Key points
- Company sites, Amazon, review sites top clicking on ads
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- Figure 64: Activities conducted as part of online research for purchases, by age, March 2012
- Three quarters go online to research unfamiliar venues/services
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- Figure 65: Process for gathering information online for an unfamiliar venue or service, by service, April 2012
Conversion and Purchasing
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- Key points
- Value of internet ads on the rise with higher conversion rates
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- Figure 66: Conversion to purchase from internet ad exposure, April 2009-November 2011
- Email remains powerful marketing tool
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- Figure 67: Trends in interest in email to hear about new products and services, January 2005-November 2011
- Figure 68: Willingness to provide email address to retailers, by gender, April 2012
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- Figure 69: Willingness to provide email address to retailers, by age, April 2012
- The accidental shopper
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- Figure 70: Purchases resulting from leisure use of the internet, by age, April 2012
- Figure 71: Time spent online on activities other than email, at home vs. at work, by age, April 2011-November 2011
Internet Radio
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- Key points
- Pandora’s rise
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- Figure 72: Internet radio usage in past week, stations used, by age, March 2012
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- Figure 73: Online and satellite radio activities conducted in past 30 days, by age, April 2011-November 2011
- Figure 74: Online and satellite radio activities conducted in past 30 days, by household income, April 2011-November 2011
- Reach and relevancy
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- Figure 75: Types of internet radio ads seen or heard in past month on PC, tablet, or phone, March 2012
- App usage
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- Figure 76: Download of music listening apps, by age, February 2012
- Internet radio ad exposure
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- Figure 77: Types of internet radio ads seen or heard in past month on PC, by age, March 2012
- Figure 78: Types of internet radio ads seen or heard in past month on a cell phone, by age, March 2012
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- Figure 79: Relevancy of internet radio ads seen or heard, by age, March 2012
Privacy
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- Increasing comfort in sharing information
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- Figure 80: Attitudes to internet privacy, by age, April 2011-November 2011
Search Engine Used
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- Google indomitable
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- Figure 81: Search engine usage, by age, April 2011-November 2011
- Figure 82: Search engine usage, by household income, April 2011-November 2011
The Impact of Race/Hispanic Origin
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- Key points
- PC ownership and online activity
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- Figure 83: Home computer ownership, by race/Hispanic origin, April 2011-November 2011
- Figure 84: Number of computers owned at home, by race/Hispanic origin, April 2011-November 2011
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- Figure 85: Access to the internet, by race/Hispanic origin, April 2011-November 2011
- Figure 86: Time spent online on activities other than email, at home vs. at work, by race/Hispanic origin, April 2011-November 2011
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- Figure 87: Impact of internet on lifestyle, by race/Hispanic origin, April 2011-November 2011
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- Figure 88: Online activities conducted in past 30 days, by race/Hispanic origin, April 2011-November 2011
- Figure 89: Activities conducted as part of online research for purchases, by race/Hispanic origin, March 2012
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- Figure 90: Conversion from ad to purchase, by race/Hispanic origin, April 2011-November 2011
- Asians often unintentional shoppers, blacks most interested in email
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- Figure 91: Leisure web browsing leading to a purchase, by race/Hispanic origin, April 2012
Teens and Kids
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- Key points
- Teens spend 10 hours per week online
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- Figure 92: Time spent online, home vs. elsewhere, by gender and age, October 2010-November 2011
- Figure 93: Number of websites visited by teens in past week, by gender and age, October 2010-November 2011
- Life online on the rise for teens
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- Figure 94: Trends in weekly time spent online by teens, at home vs. elsewhere, October 2009-November 2011
- Figure 95: Trends in frequency of teen online visits, at home vs. elsewhere, October 2009-November 2011
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- Figure 96: Trends in web browsing on cell phone in past 30 days among teens, November 2008-November 2011
- Online shopping and research rise 50% among teens
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- Figure 97: Trends in types of online activities conducted in past 30 days by teens, November 2008-November 2011
- Figure 98: Trends in teens’ internet and satellite radio usage in past 30 days, November 2008-November 2011
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- Figure 99: Internet ads leading to purchases among teens, by gender and age, October 2010-November 2011
- Figure 100: Cell phone access to the web among teens, by age and gender, October 2010-November 2011
- Kids
- Internet usage on the rise
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- Figure 101: Trends in incidence of kids’ web usage in past 30 days, November 2008-November 2011
- Figure 102: Trends in time spent online by kids, November 2008-November 2011
- Kids’ internet activities
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- Figure 103: Trends in kids’ online activities conducted in past month, November 2008-November 2011
- Figure 104: Online activities in past month among kids, by gender and age, October 2010-November 2011
- Kids’ attitudes to internet ads
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- Figure 105: Kids’ attitudes to internet ads, by gender and age, October 2010-November 2011
- Figure 106: Trends in kids’ web browsing on cell phone in past 30 days, November 2008-November 2011
Appendix—Devices Used to Access Internet
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- Adults’ devices
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- Figure 107: Trends in type of devices used to access the internet, April 2009-November 2011
- Figure 108: Devices used to access the internet, by age, April 2011-November 2011
- Figure 109: Devices used to access the internet, by household income, April 2011-November 2011
- Kids’ devices and locations of access
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- Figure 110: Trends in where kids use the internet, November 2008-November 2011
- Figure 111: Where kids use the internet, by gender and age, October 2010-November 2011
- Teens’ devices and locations of access
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- Figure 112: Trends in type of devices teens use to access the internet, November 2008-November 2011
- Figure 113: Devices teens use to access the internet, by gender and age, October 2010-November 2011
- Figure 114: Where teens use the internet, by gender and age, October 2010-November 2011
Appendix—Additional Tables on Exposure, Relevancy, and Online Research
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- Types of ad seen
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- Figure 115: Types of ad seen in past month on PC, by household income, March 2012
- Figure 116: Types of ad seen in past month on a PC, tablet, or phone, by household income, March 2012
- Figure 117: Types of ad seen in past month on phone or tablet, by age, March 2012
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- Figure 118: Types of ad seen in past month on phone or tablet, by household income, March 2012
- Relevancy
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- Figure 119: Relevancy of ads seen, by type of ad, by age, March 2012
- Research
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- Figure 120: Number of products or services researched online in the past week, by household income, March 2012
- Figure 121: Activities conducted as part of online research for purchases, by number of products or services researched online in the past week, March 2012
- Figure 122: Activities conducted as part of online research for purchases, by gender, March 2012
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- Figure 123: Activities conducted as part of online research for purchases, by household income, March 2012
Appendix—Additional Tables on Internet Radio
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- Figure 124: Online and satellite radio activities conducted in past 30 days, by gender, April 2011-November 2011
- Figure 125: Relevancy of ads seen or heard, by number of products or services researched online in the past week, March 2012
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- Figure 126: Types of internet radio ads seen or heard in past month on a PC, tablet, or phone, by age, March 2012
- Figure 127: Types of internet radio ads seen or heard in past month on a tablet, by age, March 2012
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- Figure 128: Relevancy of internet radio ads seen or heard, March 2012
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Appendix—Additional Tables on Internet Usage
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- Incidence and frequency of internet usage
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- Figure 129: Trends in incidence of using and frequency of using the internet, at home vs. at work, April 2009-November 2011
- Figure 130: Incidence and frequency of using the internet at home, by age, April 2011-November 2011
- Figure 131: Incidence and frequency of using the internet at home, by household income, April 2011-November 2011
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- Figure 132: Incidence and frequency of using the internet at work, by age, April 2011-November 2011
- Figure 133: Incidence and frequency of using the internet at work, by household income, April 2011-November 2011
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- Figure 134: Impact of internet on lifestyle, by gender, April 2011-November 2011
- Figure 135: Increased usage of online shopping, by age, April 2011-November 2011
- Increasing amounts of time spent online
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- Figure 136: Online activities conducted in past 30 days, April 2009-November 2011
- Attitudes to privacy
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- Figure 137: Attitudes to internet privacy, by household income, April 2011-November 2011
Appendix—Responses by Parental Status
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- Figure 138: Number of products or services researched online in the past week, by parental status and presence of children in household, March 2012
- Figure 139: Activities conducted as part of online research for purchases, by parental status and presence of children in household, March 2012
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- Figure 140: Internet radio usage in past week, stations used, by parental status and presence of children in household, March 2012
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Appendix—Additional Tables by Race/Hispanic Origin
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- Internet usage
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- Figure 141: Where adults use the internet, by race/Hispanic origin, April 2011-November 2011
- Figure 142: Devices used to access the internet, by race/Hispanic origin, April 2011-November 2011
- Figure 143: Incidence and frequency of using the internet at work, by race/Hispanic origin, April 2011-November 2011
- Search engine usage
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- Figure 144: Search engine usage, by race/Hispanic origin, April 2011-November 2011
- Ads as entertainment
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- Figure 145: Preference for ads that entertain, by race/Hispanic origin, April 2011-November 2011
- Figure 146: Incidence and frequency of using the internet at home, by race/Hispanic origin, April 2011-November 2011
- Figure 147: Attitudes to internet usage, by race/Hispanic origin, April 2011-November 2011
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- Figure 148: Interest in receiving local mobile coupons on smartphone, by race/Hispanic origin, April 2012
Appendix—Additional Tables on Teens and Kids
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- Teens’ internet usage
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- Figure 149: Internet usage by teens, by gender and age, October 2010-November 2011
- Figure 150: Trends in number of times teens have used the internet in past week, trended, November 2008-November 2011
- Figure 151: Frequency of using the internet among teens, by gender and age, October 2010-November 2011
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- Figure 152: Clicking on internet ads, by gender and age, October 2010-November 2011
- Figure 153: Online activities conducted in past 30 days, by gender and age, October 2010-November 2011
- Kids’ internet usage
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- Figure 154: Time spent online by kids, by gender and age, October 2010-November 2011
- Figure 155: Search engine usage by kids, by gender and age, October 2010-November 2011
- Figure 156: Trends in websites visited by kids, November 2008-November 2011
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- Figure 157: Websites visited by kids, by gender and age, October 2010-November 2011
Appendix—Trade Associations
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