February 08, 2001

Jupiter Media Metrix reports that online ads reached a record level of over 172 billion impressions during the fourth quarter of 2000 while top Web media companies stocked 28 percent of their sites with non-paid self-promotional ads. According to AdRelevance data released today at the Jupiter Media Forum, entertainment and society Web sites ran the highest percentage of self-promotional ads (30 percent) among ad supported Web site. Jupiter analysts assert, however, that sites using too many house ads dilute their advertisers' messages, at a time when they badly need to be proving a return on investment (ROI) to those advertisers.

Highlights from the research include:

Jupiter analysts project that consumers will face an average of 950 marketing messages per usage day by 2005 (see Table A). The cluttering of messages can affect the performance of ads and will hurt Web publishers as pay-per-performance pricing increases, say Jupiter analysts.

Twenty-two percent of ads on news and information Web sites during the fourth quarter of 2000 were house ads, compared with 19 percent on portals and search engines, according to AdRelevance data (see Table B). Only portals did not experience an increase from the third quarter.

AdRelevance data show that house advertising levels inched upward all year, hovering around 15 percent early in the year and rising to 28 percent by the end of the year. According to Jupiter analysts, that increase can be partially attributed to a growing Web audience that create a need for media companies to fill gaps on Web pages.

"Market negativity has increased the need for advertisers to realize greater ROI from their online campaigns. The cluttering of marketing messages on Web sites has inhibited performance for online advertising and placed publishers in peril," said Mike May, research director and senior analyst for Jupiter Media Metrix. "House ads can serve a legitimate purpose for media companies, but they need to limit those that are used as mere placeholders and instead focus on demonstrating the value of the medium to their clients, and the industry at large. To reduce clutter, Web publishers should use house ads more strategically, freeing up opportunities for their clients to shine."

Table A: Consumer Exposure To Marketing Messages Online
Source: Jupiter Media Metrix
Year Marketing Impressions Per User
Per Day
----------------------------------------------
2001 - 610
2002 - 705
2003 - 800
2004 - 880
2005 - 950

Table B: Percent House Ads by Genre
Source: Jupiter Media Metrix
Genre Percent of Inventory Devoted to House Ads
----------------------------------------------
Portals and Search Engines 19%
News and Information 22%
Entertainment and Society 30%

Definitions

Impressions: The number of times an ad is rendered for viewing. One impression is equivalent to one opportunity to see an ad.

Genre: Exclusive groups of sites that are similar in content and function. Sites are considered as a whole; individual subsites are not assigned to genres.

For more information at http://www.jmm.com

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