The big ad spenders on the internet in 1999 continued to be online companies and computer-related businesses, but e-commerce and financial companies are gaining fast in this emerging, nearly $2 billion market .
   That's the big news in a report on internet advertising for 1999 from Competitive Media Reporting.
    Online and computer-related firms spent a total of $663.1 million last year on internet advertising. That was an increase of 44.4 percent over 1998 internet ad spending, and made it the largest single internet advertiser category.
   However, with other categories increasing their spending at a faster rate, the computers and online share of internet advertising actually fell from 44.7 percent of all internet advertising in 1998 to 34.7 percent in 1999.
    E-commerce, the second largest category in 1999, spent a total of $278 million in 1999, an increase of 153 percent. That was 14.6 percent of all internet advertising.
   The third largest internet advertising category was financial services companies, which spent $171.7 million in 1999, up 107.1 percent. Financial services represented 10.4 percent of all internet advertising last year.
   Overall spending on internet advertising rose by 85.9 percent in 1999, to a total of $1.9 billion, from just over $1 billion the pervious year.
   It now represents 2.1 percent of the total national multi-media advertising expenditure total, which hit $89.2 billion last year, making it an increasingly  significant factor in media spending.
     "Internet advertising is now clearly something every one of our accounts thinks about, as to whether or not they should be involved," says Alan Banks, executive media director for North America at Saatchi & Saatchi.
    "For some, the answer is more obvious than for others, and not everyone is jumping in yet, which is smart, but I think this market will grow rapidly as people find better ways to use it."
    Banks says that internet ad pricing issues will become clearer "as people get a  better feel for it."  He adds, "We should move more to accountability, paying by prospects rather than just CPMs, much more rapidly than in television."
    The top two internet advertisers last year were computer-related, with Microsoft spending $36.2 million and IBM spending $27.1 million.
     But General Motors elbowed aside Hewlett Packard for third place with $21.4 million spent, compared to HP's $16.2 million.
   Fifth place in internet ad spending went to First USA, a financial company, which spent $14.6 million.
    Other big internet advertisers included Toyota, Honda, MBNA America Bank, Fidelity Investments, Datek Online Brokerage, Visa and NextCard.
   Procter & Gamble was the largest packaged goods advertiser online.
   CMR's report shows that among the various advertising categories, computers and computer-related firms spend the largest share of their ad budgets on the internet--20.1 percent of total spending.
   General business and technology was next at 11.9 percent of total ad spending, followed by schools, camps and seminars at 5.1 percent.
    The biggest gainer in internet ad spending was automotive, which was up 173.2 percent in 1999 to $79.2 million, followed by local services and amusements, up 156.7 percent to $133.6 million.
   The other top 10 spending categories in internet advertising were: media and advertising, $126.7 million, up 173.2 percent; telecommunications, $62.2 million, up 101 percent; public transportation, hotels and resorts, $59.3 million, up 89.9 percent, business and technology, $37.8 million, up 108 percent, and insurance and real estate, $33.1 million, up 151.2 percent.

-Dave Lindroff covers television and research for Media Life.

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