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It has been a long time coming, but according to new stats, the internet has achieved a significant milestone this year: it surpassed newspapers to become the second largest ad medium.

Specifically, eMarketer predicts that by the time 2010 is finished, marketers will have spent just under $26bn on online ads, up nearly 14% year-over-year. At the same time, the research firm estimates that newspaper ad spend will have dropped over 8% year-over-year, to just under $23bn.

That spending on internet advertising has surpassed newspaper ad spending is not exactly surprising. Most have expected it to take place for some time. But that doesn't diminish the importance of the milestone, which says just as much about the rise of the internet as it does about the fall of the newspaper.

Advertising doesn't exist in a vacuum, of course. Marketers go where the consumers go, and on that front, consumers have been spending a lot more of their time interacting with the internet than they are interacting with print publications, including newspapers.

As Geoff Ramsey, eMarketer's CEO, noted, "Marketers are devoting bigger shares of their budgets to digital media as they see more customers shifting time toward the web." eMarketer also points out that, as an ad medium, the internet has also benefitted because it's generally easier for marketers to track ROI from online ads than it is to track ROI from print ads.

In 2011, there won't be a reversal of fortunes. eMarketer expects the internet to solidify its position as the number two ad medium, while newspapers continue to see a decline.

But life at the top poses its own challenges for internet advertising. As more and more budget continues to be allocated to the internet, competition will increase. That logically means that, in some areas, prices will increase too. And the 'internet' isn't just one big homogenous blob for advertisers.

Advertisers have a plethora of places to put their money online, from search to social, so those who want to be successful will increasingly have to up their game. Simply throwing money at the internet is not a viable strategy; as the market for internet advertising continues to mature and grow, advertisers will need strategies that are creative, sophisticated and holistic.

Patricio Robles

Published 21 December, 2010 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (5)

Niranjan Sridharan

Niranjan Sridharan, Digital Auditor at ABC

Great news..We can finally think of world domination! :)

almost 6 years ago

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Tom Edwards

Great sign of things to come for online advertising in 2011, Hopefully old school businesses with a love of traditional advertising will interact and move with the times next year. 

almost 6 years ago

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Jackie

I think newspapers are becoming obsolete; internet ads are so much better because you can post them instantly (such as Craigslist for example) and receive instant responses. Also, the digital format makes it easier for ads to be categorized. Much more user-friendly I think.

almost 6 years ago

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Jim Castro

I think people havent quit grasped the magnitude of having a target and objective presens in the WWW.

almost 6 years ago

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Dr Jim Seim

Been using Google ad-words for 3 years with great success, still struggling with Face-book though

almost 6 years ago

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