The report from Thomson Intermedia and KPMG said that search-based ads, where advertisers pay to appear during a search for terms on sites such as Google, grew more strongly than online display ads. However, the report only measures display adspend because the industry does not measure search-based advertising.
Three sectors now dominate online adspend, with the entertainment, media and leisure sector accounting for 26% of total online adspend, IT and communications companies 20% and financial companies 19%.
Paul Ryan, Thomson Intermedia's head of insight, said: "A significant part of online ad spending is unknowable and that's becoming such a major part of online advertising. We base our view on market sentiment and what several hundred of our major clients are telling us. Anecdotally we believe that type of advertising is taking a larger and larger part of adspend in new media."
Another type of online marketing spend where there is no way of measuring spend is company websites, which do not involve direct adspend through media companies and therefore are not included in online adspend figures.
"Arguably the biggest media story of the year is the continued growth of the internet as an advertising medium," Sarah Jane Thompson, chief executive of Thomson Intermedia, said. "The growth is in search-based ads, which the advertising industry can not monitor, while internet display ad revenues actually seemed to have fallen at the end of 2005."
She added that in the longer term the lack of marketing transparency in online advertising would become more of an issue as rapid growth in the medium continued.
If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the .