Based on the latest Q3 e-commerce data from the US Department of Commerce (DOC), eMarketer now predicts that online sales (excluding travel) will grow 7.2% year-on-year in 2008 to reach nearly $137bn. This compares to last year when online sales grew 19.8%. The firm expects that consumers will spend $30.3bn online this year during November and December - equivalent to year-on-year growth of 4%.
From eMarketer: http://www.emarketer.com, 24/11/2008

US retail e-commerce sales, 2007-2012 (billions and % change)

Source: eMarketer
eMarketer: http://www.emarketer.com

The first Mobile Media study from Nielsen Online has found that mobile internet use has grown eight times more than traditional PC-based usage during 2008, writes Brand Republic. Between Q2 and Q3 mobile internet use rose 25% (from 5.8m to 7.3m users) while PC-based use grew only 3% (from 34.3m to 25.3m). Mobile internet use is rising among young people, with one-in-four users aged 15-24 compared to only one-in-eight PC-based users.
BBC News is the most popular mobile internet website receiving 1.7m unique users in Q3.
From Brand Republic: http://www.brandrepublic.com, 24/11/2008
Nielsen Online: http://www.nielsen-online.com

The latest online adspend figures from IAB US and PwC show that revenues grew 11% year-on-year to reach $5.87bn - the second-highest quarterly result ever achieved. Against Q2 though, revenues only grew 2%. For the first nine months of the year US online ad revenues totalled $17.3bn (from $15.2bn in 2007) - up 14% year on year. Randall Rothenberg, President and CEO of IAB US said: "Interactive advertising continues to be the most measurable and cost-effective way to reach consumers, and we see more and more marketers seeking to harness its power."
IAB US: http://www.iab.net, 20/11/2008

Quarterly $ Revenue Growth Comparison - 2000-2008 YTD

Source: IAB US
IAB US: http://www.iab.net

The latest wave of research into consumer attitudes for mobile advertising is confirming consumer acceptance of lower call charges in exchange for exposure to advertising, writes Marketing Vox. What began as a youth behaviour appears to be spreading with two-thirds (61%) of mobile users willing to view advertising on their handsets in exchange for discounts off calls. The research by Transverse and iGR reflects a changing culture in consumer expectations of access.
From Marketing Vox: http://www.marketingvox.com, 20/11/2008
Transverse: http://www.gotransverse.com

Would you be willing to view advertisements on your mobile in exchange for an incentive?

Source: Transverse
Transverse: http://www.gotransverse.com

Under what conditions would you be willing to view these ads?

Source: Transverse
Transverse: http://www.gotransverse.com

The third International Communications Market Report from Ofcom has found that the UK has the highest penetration of digital TV services of all the larger countries surveyed, with 86% of British households now using digital services on their main TV sets (up 9% on last year), writes Brand Republic. The US and France follow with 70% and 66% respectively. The study has also revealed that ad revenues are no longer the main source of commercial TV funding as a result of the growing use of pay-TV services and Digital Video Recorders (DVRs). Global TV advertising generated 49% of revenues (£81bn) - a decrease of 50% on 2007. However, subscription revenues rose 2% to 43% to reach £71bn.
The UK also leads Europe in the number of High-definition (HD) enabled households, with 700,000 (6%) - higher than the combined figure for France, Germany and Italy (500,000). The US has the highest number of households with HD subscriptions at 6m (6.2%) though Canada leads on penetration at 17.6% (with 2m households). British consumers also come first for DVR use, with 30% using the devices compared to 21% in both Italy and Canada, and 20% in the US.
According to the report the UK benefits from competitive pricing bundles with a typical triple-play package (with landline, four mobile phones, pay-TV and broadband access) costing £104/month compared to £114 in Italy and £131 in France.
From Brand Republic: http://www.brandrepublic.com, 20/11/2008
Ofcom: http://www.ofcom.org.uk

67% of Brits now think that internet access is more vital than access to a car (54%) or washing machine (58%), writes Netimperative. The results, taken from new research by YouGov on behalf of AMD also found that 57% of respondents use social networking sites and that 56% would rather shop online than go shopping on the high street at Christmas (54%) or socialise with friends (49%). 78% of Brits have also uploaded digital photos, while 75% have gone online to watch YouTube videos (88% of men against 63% of women). In general, men prefer content (71% have downloaded music against 62% of women), while women prefer communication (53% use instant messenger against 47% of men).
From Netimperative: http://www.netimperative.com, 19/11/2008
AMD: http://www.amd.com

British viewers will be able to watch both BBC1 and BBC2 live online through the bbc.co.uk website and the BBC's iPlayer service from the end of November, writes Brand Republic. The corporation already provides BBC News, BBC3, BBC4, CBBC and CBeebies online in real-time. The online live broadcast service is being run as a 12-month trial. Speaking of the launch BBC Vision director Jana Bennett said, "The launch of BBC One and BBC Two online completes our commitment to make our portfolio of channels available to watch on the internet."
iPlayer usage has continued to grow all year, and according to the new "Olswang Convergence Consumer Survey 2008" 24% of consumers now use the service to watch programmes for at least one hour per week. The service is set for another big upgrade following approval from the BBC Trust for upgrades to the iPlayer which will enable users to pre-book programmes up to 7 days before broadcast and download them for viewing.
From Brand Republic: http://www.brandrepublic.com, 19/11/2008
BBC: http://www.bbc.co.uk

The "2008 Annual Global Mobile Attitude and Usage Survey" from the Mobile Marketing Association (MMA) has found that 8% of Western European consumers have taken part in some form of mobile marketing during the last year, writes ClickZ. In addition, one third of consumers have said that they are "interested" in mobile marketing. In the UK, the survey found that 64% of respondents have used text-based contests or voting with their mobiles, while 25% use SMS alert services. It also showed that 10% of those polled in the UK use mobile internet services each week.
From ClickZ: http://www.clickz.com, 17/11/2008
MMA UK Chapter: http://www.mmaglobal.com/uk

Google is bringing in a variation of its AdWords model to YouTube in an effort to raise revenues from the leading online video site, writes The Financial Times. The new YouTube Sponsored Video service will allow YouTube users to promote their videos in a special sponsored video section. Users can then bid on keywords to promote their sponsored videos, paying for them on a cost-per-click basis. The service has no minimum spending requirement and users can specify a daily budget. If the service takes off Google can look forward to a whole new search-based profit stream: recent figures from comScore found that YouTube received more search queries in September than any other website other than Google and Yahoo!.
YouTube is also going to start offering ad-supported full-length feature films. The site has announced a new deal with studio Metro-Goldwyn-Mayer (MGM), which will see a number of branded content channels offering free-to-watch films and TV shows including "Bulletproof Monk" and "The Magnificent Seven". The news follows the deal announced with CBS reported in last month's Digital Intelligence.
From The Financial Times: http://www.ft.com, 13/11/2008
YouTube: http://www.youtube.com

The latest figures from the IMRG Capgemini e-Retail Sales Index forecast that online retail will grow 15% year-on-year during the fourth quarter to reach £13.16bn, writes Netimperative. The figure represents a £215 online spend for every person in the UK. However growth will be significantly lower than last year when online retail rose 54% from 2006. Monday 8th December is expected to be the busiest day for online shopping with sales of up to £320m predicted.
Further research from JupiterResearch commissioned by LinkShare estimates that the average UK consumer will spend 40% more online than the average US consumer and will make 24% more of their purchases online. UK consumers are eight times more likely to carry out online research across multiple sites before buying online and are also 13% more likely to be frequent online shoppers than US internet users.
According to the annual Deloitte Christmas Retail Survey which looks at total retail spending, British shoppers are expected to spend on average £655 in total this Christmas - equivalent to 7% less than last year. However 19% of consumers still intend to spend more.
From Netimperative: http://www.netimperative.com, 10/11/2008
IMRG: http://www.imrg.org

MySpace in implementing a novel way of generating ad revenues and resolving copyright issues with regards to copyrighted video clips uploaded by users, writes Netimperative. Using new technology from Auditude all clips uploaded to the social networking service will be scanned and compared against a library of 1bn minutes of content. The system can then automatically insert ads into videos which contain professional content, with MySpace sharing revenues with the original content copyright holders. Clips will also feature system-generated overlay bars with information about the clip and links to buy original episodes or films. MTV Networks have already signed up as partners to the service and MySpace have said that further ad formats and partners will follow. The firm has also said that it will still remove clips at the request of copyright owners.
MySpace has also launched its new "Profile 2.0" user interface, giving users new tools and features for editing their profiles. Layouts can now be changed using a drag-and-drop interface and users can create categories for different contacts allowing them to select what information different groups of people can see.
MySpace has now overtaken Yahoo! as the leading publisher of online display ads in the US, accounting for 15.9% of all display ads in June. According to comScore the site attracted 75m unique users in the US and 122m unique users worldwide.
From Netimperative: http://www.netimperative.com, 06/11/2008
MySpace: http://www.myspace.com

New research from comScore has found that 14.5m people in the UK visited at least one blog in August, writes Netimperative. The figure equates to 41% of the UK's total internet audience. The top individual blog for the month was Engadget.com (with 243,000 visitors) followed by UnrealityTV.co.uk (225,000 visitors) and Gizmodo.com (with 223,000 visitors). The most popular blogging platform in the UK remains Google-owned Blogger.com (with 9m visitors) followed by WordPress (4.8m) and Six Apart-owned sites (2.7m).
From Netimperative: http://www.netimperative.com, 31/10/2008
comScore: http://www.comscore.com

A selection of leading blog platforms ranked by total UK unique visitors (000) *

Age 15+ - Home & Work Locations, August 2008

Source: comScore
comScore: http://www.comscore.com

A selection of leading individual blogs ranked by total UK unique visitors (000)*

Age 15+ - Home & Work Locations, August 2008

Source: comScore
comScore: http://www.comscore.com

A new study from Key Note predicts that online adspend will continue to show strong growth through the rest of 2008 and into 2012, writes Brand Republic. The firm expects online to grow 31.4% in the UK over the course of this year. Figures from IAB UK put online adspend at £1.7bn for the first half of 2008, up 21% while the latest Bellwether Report forecast that online would remain strong as companies cut their marketing costs. Online advertising in the UK continues to be driven by the growing use of broadband services with Key Note reporting that 93% of respondents to their survey go online at home. The report also found that marketers had so far "under-exploited" the possibilities presented by social networking sites as a means of engaging consumers.
From Brand Republic: http://www.brandrepublic.com, 31/10/2008
Key Note: http://www.keynote.co.uk

Tough markets trigger creative thinking, which means a wave of rebuilds on the way for failing brand sites, weak online media and under performing e-retailers. Collating this month's stories for Digital Intelligence, we're seeing the innovation start. For those getting it right, the prizes are rich: here in the UK, the switch to online shopping continues with the latest research showing that over 11m Brits are shopping on the web at least twice a week.

For many firms it also means a leap into long delayed training of their teams to find smarter uses of precious marketing budgets; getting more value from agencies and online media. The web will prove the deciding factor for many consumer brands and B2B services.

We're wishing our friends and partners a big slice of digital cake in the run up to the biggest e-commerce Christmas so far.
Read October 2008

Here are the latest stats and figures from the past month.

Monthly internet usage statistics for the UK, September 2008

Source: Nielsen/NetRatings Home/Work Panel monthly statistics
Nielsen Online: http://www.nielsen-online.com

Monthly top ten UK parent companies for August 2008

Source: Nielsen/NetRatings Home/Work Panel monthly statistics
Nielsen Online: http://www.nielsen-online.com

Top 10 popular websites in the UK, September 2008

This list features the most popular websites based on UK Internet usage for September 2008, ranked by market share of visits across all Hitwise industries.

Source: Hitwise Datacentre, September 2008, based on market share of visits
Hitwise: http://www.hitwise.co.uk/datacenter

Worldwide Active Internet Home Users, August 2008

Source: Nielsen/NetRatings
Nielsen Online: http://www.nielsen-online.com

Profits at Microsoft reached $4.37bn during Q3 from $4.29bn in 2007, writes Netimperative. Turnover rose 9% during the same period to $15.06bn. However the firm has now warned that it is unlikely to meet Wall Street predictions during the next quarter due to economic conditions. Chief Financial Officer, Chris Liddell, said: "We, like most companies, saw a slowdown at the tail end of the quarter in particular. We're now taking a more conservative stance on the balance of the year."
The firm has also revealed its new cloud computing platform dubbed Windows Azure. The firm is following Amazon and Google in providing web developers and others a place to store content and applications without the need for them to have dedicated servers but with enough capacity and bandwidth to withstand a sudden rush in online demand.
From Netimperative: http://www.netimperative.com, 27/10/2008
Microsoft Azure: http://www.microsoft.com/azure

Challenges in the wider economy spilled onto the web, pushing ad rates in the US down 27% according to PubMatic. Their AdPrice Index tracked a big slump in Q3 2008, with prices down 21% from Q2 and 27% from Q1. All categories showed drops with the exception of Technology which remained static. The report also found that ad inventory on small websites is worth over three times that of large websites, at 61 cents and 18 cents respectively.
PubMatic: http://pubmatic.com, 23/10/2008

Website AdPrice Averages by Size

Source: PubMatic
PubMatic: http://pubmatic.com

Third quarter profits at Amazon were up 48% with revenues climbing 31%, writes The Financial Times. Net income was $118m, from $80m in 2007, while revenues reached $4.26bn from 3.26bn in 2007. International sales continued to grow and represented 46% of all revenues. Q4 sales are expected to fall between $6bn and $7bn with year-on-year quarterly growth ranging from 6% to 23%. The firm now expects full-year sales of $18.46bn-$19.46bn - down from its previous estimate of $19.35bn-$20.1bn.
In the UK, the firm has cut its threshold for free delivery from £15 to £5, mirroring moves it made in the US last year.
From The Financial Times: http://www.ft.com, 23/10/2008
Amazon UK: http://www.amazon.co.uk

Yahoo! has announced that it is to cut 10% of its staff (over 1,500 people) following poor quarterly results, writes vnunet. Q3 profits were down 64% to $54.3m, compared to $151.3m in 2007. The firm now hopes to save $400m through the redundancies and other cost-cutting exercises.
From vnunet: http://www.vnunet.com, 22/10/2008
Yahoo! UK: http://uk.yahoo.com

The latest data from the US digital audience market flags up micro-blogging technology Twitter as being the hottest of the toolkits in terms of growth, writes CNET. Rising almost 350% in the last period, Twitter is a great tool for delivering simple messages about what people are engaged in at that moment. Under the direction of internet whiz Seth Godin, this "presence" application has spread among the web heads and early adopter youth markets but now looks set to find a solid commercial footing.
From CNET: http://news.cnet.com, 22/10/2008
Twitter: http://www.twitter.com

A new study from price comparison site Shopzilla.co.uk has found that over 11m British consumers buy products online at least twice each week, writes Brand Republic. The study further found that 9 out of 10 consumers shop online at least once each month.
Consumers are increasingly heading online to save money and find deals. A further study from LinkShare in conjunction with JupiterResearch found that 56% of consumers plan to reduce their offline spending against 46% who intend to cut their online spending. In addition 39% of online consumers plan to spend more time searching online for the best price. However, according to the latest IMRG Capgemini e-Retail Sales Index, total growth in online retail is slowing as consumers spend less overall. September saw monthly online retail growth of 14.8% on the previous month compared to 73.2% in September 2007.
In contrast Hitwise has found that searches for second hand products have risen 22% in the last year, while classified sites are up 47%.
From Brand Republic: http://www.brandrepublic.com, 21/10/2008
Shopzilla.co.uk: http://www.shopzilla.co.uk

Monthly change in IMRG Capgemini Index

Source: IMRG
IMRG: http://www.imrg.org

Third quarter revenues at Google were up 31% year-on-year, beating Wall Street expectations, writes ClickZ. Revenues for the quarter totalled $5.54bn, up 3% on Q2.
Net income in Q3 was $1.35bn (from $1.25 in Q2). 67% of revenues came from its own web sites, up 34% from the same point in 2007. 30% of revenues ($1.68bn) came from partners through the firm's AdSense network. In total 51% (or $2.85bn) of Q3 revenues came from outside the US.
Google has also announced two expansions to its AdSense ad system. Firstly the firm is rolling out contextual ads in its online mapping service, by serving text ads which are geographically relevant to individual searches. In addition the firm is making its first move into the in-game advertising market with the launch of "AdSense for Games". In-game advertising is set to become increasingly significant - new figures from comScore show that 25% of internet users play online games ever week - equivalent to 200m users worldwide.
From ClickZ: http://www.clickz.com, 16/10/2008
Google AdSense: http://www.google.com/adsense

Barack Obama's presidential campaign has gone after the youth vote with a high-profile use of in-game advertising, writes Brand Republic. The election campaign paid for adverts across 18 video games including "Burnout Paradise", "Guitar Hero" and "Madden 09". Adverts in the racing game "Burnout Paradise" on the Xbox 360 Live network featured realistic billboard ads at the side of the road for both Barack Obama and VoteForChange.com.
From Brand Republic: http://www.brandrepublic.com, 14/10/2008
VoteForChange.com: http://www.voteforchange.com

The 2008 Digital Music Survey from Entertainment Media Research has found that for the first time the majority of music downloaders are using legal means, writes Netimperative. 51% of consumers now use legal download services, up 9% from 47% in 2007. The growth in legal downloading is predominantly being driven by older music fans with 39% of over-45s and 44% of 35-44 year-olds now using legitimate services (from 28% and 36% respectively). 40% of over-35s are now buying music downloads at least once a month. The survey also found that the number of illegal music downloaders in the UK has dropped by 10%.
From Netimperative: http://www.netimperative.com, 14/10/2008
Entertainment Media Research: http://www.entertainmentmediaresearch.com

New research from Point Topic shows that China overtook the US in high-speed and broadband lines in August, writes ClickZ. China is also adding new broadband subscribers at twice the rate of the US. In the US, the number of new broadband lines fell from 3.4m in Q4 2007 to 1.1m in Q2 2008. During the same period the number of new lines added in China rose from 3.5m in Q4 2007 to 5.0m in Q2 this year.
From ClickZ: http://www.clickz.com, 14/10/2008
Point Topic: http://point-topic.com/

Broadband Subscribers by Country, Q2 2007-Q2 2008 (M)

Source: Point Topic
Point Topic: http://point-topic.com/

Saturation of broadband subscribers per region

Source: Point Topic
Point Topic: http://point-topic.com/

The latest Bellwether Report from the Institute of Practitioners in Advertising (IPA) has found that 35% of companies revised their marketing budgets down in Q3 against only 12% reporting a rise, writes The Guardian. The last quarter has seen the worst advertising budget cuts in the report's nine year history with all marketing sectors other than online and internet search seeing budget cuts. "Main media" and the "all other" categories were each slashed by about 26%, sales promotion was cut by 6% and direct marketing was down by 5%.
From The Guardian: http://www.guardian.co.uk, 13/10/2008
IPA: http://www.ipa.co.uk

A new survey by Vanson Bourne on behalf of 02 has found that budgets for mobile marketing are expected to rise 150% by 2013, writes Brand Republic. 60% of those polled thought that mobile marketing was better for close targeting, in particular for financial services advertising.
From Brand Republic: http://www.brandrepublic.com, 10/10/2008
Vanson Bourne: http://www.vansonbourne.com

Two significant moves from YouTube this month point at how Google plan to effectively monetise the online video giant. Brand Republic report on a new deal with iTunes and Amazon which will see YouTube integrate "Click to buy" buttons directly into videos. Consumers will be able to move directly from a music video, for example, to a store offering the mp3 track for sale. However, the initiative is not limited to music purchases - Electronic Arts will be using the programme to drive sales of its new game 'Spore'. YouTube will receive a commission for each sale made through the process.
The second move, reported by Reuters, sees the firm offering full-length TV shows from the CBS archive, including "Star Trek" and "Beverly Hills 90210". These will be available in the website's new "Theatre View" format which fills the screen horizontally against a black background. In a first for YouTube, episodes will include pre-roll, mid-roll, post-roll and banner advertising as the site capitalises on the new content. Ads on the first wave of shows will be exclusively sold by CBS.
The plans follow news of the latest comScore figures which show that YouTube has overtaken Yahoo! as the second biggest internet search site in the US after Google.
Reuters: http://www.reuters.com, 10/10/2008
Brand Republic: http://www.brandrepublic.com, 08/10/2008

A new study from Hall and Partners has found that nearly 75% of 18-34 male internet users spent over 10 hours/week online during Q2 2008, writes eMarketer. The study, carried out for Break Media, reported that 69% of those asked said that they could not live without the internet, against 31% who said the same for television. Nearly 60% said that they could recall online ads when they were not online and 47% had purchased a product or service because of an online advert.
From eMarketer: http://www.emarketer.com, 09/10/2008
Hall and Partners: http://www.hallandpartners.com

Time spent online per week according to US male internet users aged 18-34

Source: eMarketer
eMarketer: http://www.emarketer.com

New US figures from the IAB and PwC show that online adspend grew 15% year-on-year in the first half of 2008 to reach $11.5bn, writes ClickZ. Q2 adspend was up 13% year-on-year to $5.7bn but was down 0.3% from Q1 this year. Search revenues were up 24% to $5.1bn or 44% of all online adspend. Display advertising rose 19% to $3.8bn (33% of all online adspend).
PwC expect that online adspend in the US will total between $22bn and $25bn for the whole year. This estimate is further reinforced by data from eMarketer which has projected online adspend figures of $24.5bn on annual growth of 17.4%.
From ClickZ: http://www.clickz.com, 07/10/2008
IAB US: http://www.iab.net

% of second quarter revenues

Source: IAB US
IAB US: http://www.iab.net

US online advertising spending growth 2008 & 2009

Source: eMarketer
eMarketer: http://www.emarketer.com

The latest IAB/PwC figures show that online advertising in the UK grew 21% year-on-year in the first half of 2008 to reach £1.7bn as the total ad market fell 0.7% to £9bn. Online took 18.7% of UK adspend, behind total press display (19.3%) and TV (21.7%). Search advertising led the growth increasing 28% to account for 58.3% of all online adspend. Display was up 16.3%, while online classifieds grew 30.2%.
Overall, growth rates were down on the first half of 2007 when they reached 41.3% on online adspend of £1.3bn. Guy Phillipson, IAB UK's Chief Executive Officer said: "Online is not immune from the economic downturn, but while other sectors see falls in expenditure the internet is still experiencing an incredible increase and is propping up the entire advertising market."
IAB UK: http://www.iabuk.net, 07/10/2008

UK advertising spending by media, first half 2008

Source: Source: IAB UK
IAB UK: http://www.iabuk.net

With financial markets in turmoil and marketing budgets tightening we're going against the trend by forecasting relatively strong times for online marketing. When marketing budgets need proof, marketers will stick with the internet. Partly it's the accountability of knowing you only pay for banners that get downloaded or search listings that get clicked, partly it's the way that sites fuel the sales teams of most firms, and how even in FMCG their web presence is the gateway to relationship marketing programmes.

We also cover the latest announcements from Amazon and the BBC, as well as research from ComScore which confirms that here in the UK, video on the web has certainly crossed its tipping point: watch next year as video advertising follows.
Read September 2008

Here are the latest stats and figures from the past month.

Monthly internet usage statistics for Germany, August 2008

Source: Nielsen/NetRatings Home/Work Panel monthly statistics
Nielsen Online: http://www.nielsen-online.com

Monthly top ten German parent companies for August 2008

Source: Nielsen/NetRatings Home/Work Panel monthly statistics
Nielsen Online: http://www.nielsen-online.com

Top 10 popular websites in the UK, August 2008

This list features the most popular websites based on UK Internet usage for August 2008, ranked by market share of visits across all Hitwise industries.

Source: Hitwise Datacentre, August 2008, based on market share of visits
Hitwise: http://www.hitwise.co.uk/datacenter

Worldwide Active Internet Home Users, July 2008

Source: Nielsen/NetRatings
Nielsen Online: http://www.nielsen-online.com

New research from Hitwise has tracked how the behaviour of British internet users has changed since the onset of the credit crunch, writes Netimperative. Firstly consumers are heading online to save money: traffic to price comparison websites was up 20% year-on-year in July 2008, while searches for summer sales were three times higher this year than last. In addition traffic to discount voucher websites has grown 130%.
Secondly, traffic to property websites has fallen from 0.85% of all UK internet visits to 0.55%. Searches for property sales were also down 53.1% year-on-year in August 2008. In contrast visits to Hitwise's House and Gardens category rose from 0.49% to 0.59% during the same period as consumers chose to focus on DIY improvements and new home furnishings.
Finally, online searches for energy efficiency terms such as "loft insulation" have more than doubled during the past year. Traffic to energy suppliers has also doubled in the last 12 months as consumers look to switch to cheaper deals.
From Netimperative: http://www.netimperative.com, 30/09/2008
Ofcom: http://www.ofcom.org.uk