Mobile advertising was the fastest growing of all segments, expanding by almost 150 percent to become a $1.6 billion industry.

The rate of growth is particularly impressive because digital advertising also shattered previous records in 2010. The industry grew by a larger percentage in 2011 than it did in 2010.

The industry continues to grow so rapidly because advertisers still have a way to go before they match consumers' embrace of Internet platforms, explained Sherrill Mane, the senior vice president of research, analytics and measurement at IAB.

"There's a fact of life called consumers. Consumers are using and embracing digital more and more, and fundamentally the advertising business is still playing catch-up. The money has to flow to where the folks are," she said.