Value of online advertising to more than double in five years, study says

With greater sophistication among advertisers using a new generation of online marketing tools, the value of online advertising will more than double over the next five years, from $6.6 billion in 2003 to $16.1 billion in 2009, JupiterResearch reports.

More of the growth will come from online display and classified ads than in the past, as these forms of advertising come closer to matching Internet paid search in dollars spent, Jupiter says. It notes that the value of online display and classified ads will grow at more than 25% compounded annually over the next five years, as paid search grows 30% compounded annually over the same period.

"The growth in online advertising is the product of all the progress that web sites and technology providers have made in the last two years,” said Jupiter senior analyst Gary Stein. “We`ve seen companies very actively working to make the Internet a more attractive advertising medium. With targeting technologies, the discovery of search by major advertisers, and real measurement and planning tools, the Internet is ready to fulfill its early promises of effectiveness, reach and trackability."