Performance based ad expenditures up in 2007

AUN Consulting released their 2007 Internet ad report and found that performance based ad spend was up for both web and mobile. The total amount spent by Japanese companies on pay-for-performance ads in 2007 was 144 billion Yen (a 39% increase from the previous year). Web based P4P ads up 32% to 127.7 billion Yen, while mobile P4P ads were up 152% to 16.4 billion Yen. Performance based ad expenditures still represent a fraction of overall online ad spend. Total  Internet ad expenditure for 2007 was 489.3 billion Yen (web: 430 billion, mobile: 59.3 billion) Search based ads was also up 23% in 2007 to 107.8 billion Yen while contextual advertising saw a 109% increase from the previous year finishing off at 19.9 billion Yen. I believe that the online advertising market in Japan has finally come to its own. Spending will continue to climb as more advertisers discover the reaching power of SNS and mobile properties. Performance based mobile advertising will probably see the biggest increase over the coming years with projected spending surpassing web based spending by 2011. Mobile gaming and SNS sites such as Mobage Town and Mixi Mobile stand to benefit the most from the projected increase. I haven’t made any predictions for 2008 yet, but if I did, it would include an 30% increase in the number of mobile affiliate networks operating in Japan and possibly Yahoo Japan opening up their contextual ad business to both web and mobile publishers.