Monday, April 1, 2002

Several Leading Researchers Also Support IAB/PwC Figures

New York, NY - April 1, 2002 - eMarketer, the world leader in aggregating and analyzing e-business statistics from over 1,000 research, consultancy and government sources, has selected the Interactive Advertising Bureau's (IAB) Internet Ad Revenue Report as the benchmark source for measuring the growth of Internet ad revenue. Accordingly, eMarketer will hold its future projections accountable based on the online ad revenue figures reported in the IAB's Internet Ad Revenue Report, which is conducted independently by the New Media Group of PricewaterhouseCoopers.

eMarketer selected the IAB/PwC report after conducting an exhaustive analysis of all firms purporting to measure online ad revenues in the U.S. Presently, there are nearly two dozen researchers, investment banking firms, analysts and ad agencies that have reported estimates of online advertising revenue for 2001. But the range is wide, from a low of $2.5 billion to a high of $19.0 billion.

Through a process of data collection, interviews and intensive market analysis, eMarketer compared the researchers and their respective revenue data. They found that the wide discrepancies in reporting were largely due to different definitions and methodologies used by the researchers. Many, for example, do not include significant sources of online ad revenue in their compilation of data. Additionally, when all of the revenue sources as outlined in the IAB/PwC report were factored in to the individual research estimates, most of the resultant revenue figures were strikingly similar.

"It is gratifying to know that eMarketer, after quite a bit of research into the miasma that is Internet ad revenue reporting, is sufficiently satisfied in the methodology and accuracy of our report to make it their benchmark," noted Tom Hyland, Chair, PricewaterhouseCoopers New Media Group. "The significance of these numbers, and the importance of consistent reporting cannot be overemphasized, since they are closely watched by advertisers, agencies, ad networks and importantly, Wall Street."

"This endorsement, based on extensive research done by eMarketer, is really good news for our industry, since it goes a long way toward answering the question of why these numbers have been so wide-ranging, and underscores the professionalism and accuracy of PricewaterhouseCoopers' methodology," said Greg Stuart, President & CEO of the IAB. "While all advertising sectors have seen measurable declines, online advertising, while down, is not in nearly as much trouble as other sectors which are experiencing double digit declines in revenue. For the sake of clarity in our industry, it is time for us to call to task those organizations which have, what we assume are significant flaws in their methodology, and politely ask them to either do the proper research, or admit that their efforts are at best, counterproductive, and may, in our opinion, be fiscally irresponsible."

eMarketer identified a number of key findings from its analysis, including:

  • Eight leading research and analyst firms currently report spending figures that are in alignment with the levels reported by IAB/PwC -- approximately $8 billion for 2000 and between $7.0 - $7.9 billion for calendar year 2001.
  • In addition to eMarketer, several analyst/research groups have officially endorsed the IAB/PwC numbers as being representative for the industry. These include: JP Morgan Chase, Veronis Suhler Stevenson among others.

As an example of how different definitions can distort comparisons, consider Morgan Stanley , which reported 2000 revenues of $7.4 billion. This figure, however, excludes barter and e-mail, which constitute 10% of total dollars. If these items are added back in, the resultant total is $8.2 billion, the same figure as reported by the IAB for that year.

Similarly, while Forrester Research estimated online ad revenues at only $6.0 billion in 2001, this figure excludes both classified ads and e-mail. If these same items are factored in, based on IAB percentage allocations, then Forrester's adjusted figure would be $7.3 billion. This figure matches the level estimated by eMarketer, which in turn benchmarks its figures against IAB/PwC data (note: the IAB/PwC reported online ad revenues for the first three quarters of 2001 at $5.5 billion).

To view the two charts associated with this press release, please contact Geoffrey Ramsey at [email protected].

"With over 20 different researchers offering up 20 different sets of numbers, no wonder advertisers, their agencies and publishers have been confused," said Geoffrey Ramsey, CEO, eMarketer. "However, when certain outliers are removed and apples-to-apples comparisons are made between numbers, allowing for differences in definitions, estimates from most of the leading research firms closely match those reported by the IAB/PwC."

About eMarketer
eMarketer,, is the world's leading provider of e-business statistics. Aggregating, filtering, organizing and analyzing data from over 1,000 research firms, consultancies, universities, government and NGO organizations around the globe, it makes internet and e-commerce information available to marketing professionals in a variety of forms, including reports, the eStat Database, newsletters and StatAlerts. eMarketer's market projections and analytical commentaries are featured by hundreds of news organizations and business publications, every week. Founded in 1996, eMarketer is headquartered in New York, New York.

About the IAB
Founded in 1996, the IAB is the industry's leading interactive advertising association and represents companies that sell over 70% of online advertising, including AOL, CNET, MSN, Yahoo, DoubleClick and many others. Its activities include evaluating and recommending standards and practices, fielding research to document the effectiveness of the interactive medium and educating the advertising industry about the use of interactive advertising. Membership includes companies that are actively engaged in the sale of interactive advertising.


Marla Nitke IAB
[email protected]

Geoff Ramsey
CEO - eMarketer
(212) 763-6042
[email protected]