Spending on online advertising in Ireland increased by 12.8 per cent to €73.2 million in the first half of 2012, according to industry body IAB Ireland.

This was a slower rate of increase than in the first half of 2011, when growth rates exceeded 20 per cent. However, it contrasts sharply with the 6.7 per cent decrease in ad spend in traditional media recorded by Nielsen Media Spend for the same period.

“While the growth isn’t as dramatic as it was in our last study, it is certainly still significant,” IAB Ireland chief executive Suzanne McElligott said.

The fast-moving consumer goods sector now spends the most on online ads, overtaking telecoms, which has slipped to third, with the finance sector in second.

Search advertising enjoyed a 45 per cent share of the market, followed by display at 34 per cent and classified at 21 per cent. Growth in display was driven by an increase in spend on social media sites.

Although 56 per cent of IAB members expect online ad spend to enjoy growth in 2013, only 9 per cent expect “strong growth” in the market.

“I think that’s realistic. We all know it’s been a hard year,” Ms McElligott added.