Of those advertisers increasing their online spend, 82% said they were funding the increase by downsizing their print, TV or direct marketing budgets, according to a European Interactive Advertising Association survey.
About 40% claim the online increase came from their print budget, while 39% took from their TV budget and 32% from their DM budget.
The results also revealed that 38% of advertisers now regard online as essential, compared to 17% in 2006.
Over three quarters (77%) of those questioned found online advertising to have a positive impact on the perception of their brand as well as overall brand awareness (68%).
Online spend is increasingly being focused in three key areas. Display remains the dominant format taking 38% of spend, up 9% from 2006, while search and affiliate advertising are experiencing rapid growth, up 35% and 25% respectively since 2006.
According to 80% of respondents, their search spend is predicted to increase in the next two years, while 59% will be investing more money in display.
Alison Fennah, executive director of the EIAA, said: "This research shows that while other forms of media are suffering from slowing spend, online continues to take a growing proportion of advertising budgets as brands increasingly recognise its impact, value and potential ROI."
The EIAA Marketers' Internet Ad Barometer was conducted online with senior marketing executives with responsibility for advertising budgets and/or strategy across UK, France, Germany, Italy, Spain, Netherlands, Belgium, Norway, Sweden and the pan-Euro sector.