Dipping into the Blogpond

Cameron Reilly had a brief mention of an article in yesterday’s Australian Financial Review by Foad Fadaghi. The full article (update: now requires payment) can be referenced at the Australian online issue of the BRW magazine and is an incredibly in-depth analysis of online advertising in Australia. Some points from the article are below.

• Online Advertising is classified in four areas; general display, search, classified and directories
• BRW estimates online advertising revenue in Australia increased 66% to $1.02 billion
• 11.5 million Australians were online, and spent 20% more time online
• The “social web” is growing, as are niche websites, creating a challenge for marketers

ESTIMATED MARKET SHARES

Search

Google 89%, Yahoo!7 5%, NineMSN 3%, Sensis 2%, other 1%

Display

NineMSN 26%, Fairfax Digital 14%, Yahoo!7 9%, News Digital Media 7%, Sensis 6%, Realestate.com.au 5%, Carsales.com.au 2%, other (Seek, Ebay etc) 30%

Classifieds

Seek 34%, Fairfax Digital 22%, Realestate.com.au 17%, Carsales.com.au 9%, Sensis 5%, News Digital Media 3%, Yahoo!7 <1%, other 9%

Directories

Sensis 98%, News Digital Media 1%, Yahoo!7 and other 1%

Ranking in terms of Market Share of Revenue

1. Google: $206 million (20%, up 4%) revenue growth 108%
2. Sensis: $192 million (19%, down 4%) revenue growth 36%
3. Fairfax Digital: $115 million (11%, steady) revenue growth 77%
4. Seek: $104 million (10%, steady) revenue growth 65%
5. NineMSN: $92 million (9%, down 2%) revenue growth 39%
6. Realestate.com.au: $70 million (7%, up 1%) revenue growth 79%
7. Yahoo!7: $42 million (7%, steady) revenue growth 75%
8. Carsales.com.au: $37 million (4%, up 1%) revenue growth 85%
9. News Digital Media: $34 million (3%, down 1%) revenue growth 26%
10. The Rest: $128 million (13%, up 1%) revenue growth 80%

• Sensis is under growing threat from other local search providers. It has managed to maintain high margins and has increased its rates for online directory listings. Sensis interactive general manager Chris Smith believes Sensis will have to embrace web 2.0 technologies and improve the sensis.com.au experience. He also claims “competing with the international players in the search engine arena has been very challenging”
• In January, Fairfax Digital announced a $4 million buy-out of essentialbaby.com.au.
• Yahoo!7 is hoping that Panama (its paid search system) will halt the slide in its share price.
• The “long tail” is where the action is! (That’s us). Growth in this “other” section was second only to Google.

This is all very encouraging for smaller websites and startups, as it shows there is more revenue to share around.