Reading about the online market in Germany, you may feel you have been transported back in time to 1999 – the last time one read so many superlatives about the growth in online sales, online ad spending, and online population in the days of the booming “new economy.”
The German online advertising market reached almost $700 million Euro in 2006 – an impressive 66% growth rate (SevenOne Media). This number does not even take keyword advertising (e.g., Google AdWords) and affiliate marketing into account. With no detailed stats available, analysts can only estimate the numbers involved. Most agree, however, that keyword advertising surpasses classic ads (like banners and popups) by almost 100%, or about $1.2 billion Euro. Affiliate marketing is estimated at somewhere between $100-$200 million Euro and growing quickly.
According to a (N)ONLINER Atlas study, 60% of the German population uses the Internet (more than 39 million Germans above the age of 14). More conservative numbers place Internet users at roughly 32 million (comScore), but even this figure makes Germany the fourth largest Internet nation (surpassing both the UK and South Korea).
However, according to the German Internet Industry association Bitkom, the number of broadband connections lags behind expectations in Germany: 37% in 2006 with a predicted 50% in 2008. Analysts attribute this to the tactics of former state monopoly German Telekom. Broadband use has tripled in the last two years, partly due to antitrust regulations and dropping prices.