Its official. The internet has become the accepted medium of advertising and more businesses are turning towards the web instead of the traditional newspaper, radio and tv advertising which are becoming unaffordable especially for small entrepreneurs.

According to Interactive Advertising Bureau (IAB), and PricewaterhouseCoopers (PwC) that released the IAB Internet Advertising Revenue Report, advertising revenues from Jan to June 2007 was nearly $10 billion. This is a 27% increase than last year, at the same time.

The advertisers are from consumer advertising sector targeting the increasingly growing online traffic and popularity of several online companies.

It is generally known that apart from email being the most used online method, "Search" is the second. The advertising formats using "Search" with Google still leading with nearly 64% of the market share (mostly US) with Yahoo coming in next. Search ads in Google accounts for 41% of the money spent.

Classified ads come second. Here are some places where you can place classified ads:

1. Craigslist (Very powerful)

2. List of free classified ads

Referrals and lead generation comes in next with email being number four. Interestingly, video ads seem to have increased as well with 8% share of the revenue.

Ad banners and display ads have 21% showing that despite the negative remarks that people are becoming "blind" to this kind of display (When was the last time you clicked on a banner ad?), this is still a popular method of spending for advertisers.

Sponsorships have dropped from last year by 1%, it is at 3% especially with Google's latest stand on paid links and the dropping of sites that are buying links. These links do not have much value in Google's eyes, so try not to spend too much money buying sponsored links.

There are two types of deals that Google offers: Cost per click (CPC) and Cost per impression (CPM).

In CPC deals, the user pays each time someone clicks on their ad and CPM is the number of 1000 impressions that the advertiser pays for.

The last on the list is slotting fees. Slotting fees accounts for a mere less than 1%. These are fees charged by webowners for posting ads in premium positions on the site, for example, a high PR home page.

From the above statistics, it is apparent that online advertising is here to stay. Retail owners and online stores are getting more competitive and with products priced neck to neck, it is a question of whose advertisement a consumer clicks first. But as we all know, everyone shops around before making a decision. Knowing what your competitors are doing and keeping on top of things, helps keep that extra profit margin.
For a market analysis and a detailed analysis of what your competitors are doing and how much they are spending on online advertisement, fill this form.

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