Behavioral Targeting Ad Spending Projected To Reach $4.4 Billion by 2012

A recent eMarketer study shows that behavioral targeting is far from being in a slump, despite the recent concerns for users privacy that led to large-scale investigations and threatened to jeopardize user-targeted advertising.

The NebuAd story and the US Senate looking into halting user-targeting via ISPs raised a whole lot of concerns: ‘Advertising per se is not the evil here,’ said Leslie Harris from the Centre for Democracy and Technology. ‘It’s the collection of individuals’ information, usually without their knowledge, always without their consent, creation of profiles and the complete inability of people to make choices about that.’ NebuAd, however, best known for their ad-targeting capabilities, insists that its profiles are interest-based, and not personally identifiable. ‘We have designed our entire company to make sure that we stay on the opt-out side of those laws and policies,’ says NebuAd CEO Robert Dykes.

It appears that neither the NebuAd story nor the US Senate looking into ISPs practices had a negative impact on the development of the behavioral targeting market – if anything, it will sustain a consistent growth over the following years and is due to reach $4.4 billion in 2012 (source:

With only $775 million in 2008, how can the US spending for behaviorally targeted online advertising reach almost a sixfold figure in only four years?

The answers are many but they all channel towards:

– the current economic state, where advertisers are constrained to track and justify each ad dollar spent, making behavioral targeting their preferred choice to maximize conversions efficiency;

– the rapid increase in online video advertising, requiring fine-targeting in order to make it cost-effective while CRMs and CREs are still extremely high.

According to the eMarketer, “impressive growth in behavioral targeting will occur from 2010 to 2012. The influx of brand advertising online will support behavioral targeting’s growth, but brands will not reach a critical mass for display-type advertising until that period”.

It is projected that approximately one in four dollars will switch from content site ads to behaviorally targeted advertising by 2012 but one big question is left to be answered: is the display ad spending driving the growth of behaviorally targeted ads, or the increasing opportunities and targeting technologies are the drivers of display ad spending?

For graphs and figures, check out the Behavioral Targeting: Marketing Trends report.