Latest survey shows online revenues to overtake print

This morning's FT carries news of one of the latest surveys of advertising spend from America which predicts that

US online advertising and marketing spending will overtake print this year as traditional media spending continues to decline,

According to the survey by Outsell

Online spending is forecast to rise 9.6 per cent to $119.6bn, while print spending will fall 3 per cent to $111.5bn, according to a survey of 1,000 advertisers by Outsell, a publishing research company.

and Chuck Richard,its Vice President and Lead Analyst was quoted as saying that

“Advertisers are directing dollars toward the channels which generate the most qualified leads and most effective branding. As they emerge from the recession, they need more accountability, and they’re spreading their spending over a widening set of options,

Is this the year for mobile advertising to take off?

One possible effect of the I-pad could be the arrival of the so called mini advert.

A possibility explored in the New York Times which says that

Every year around this time, a few brave forecasters declare that advertising on mobile devices is poised to become the next big thing in marketing. And every year, the results disappoint.

Last year it accounted for less than a third of one percent of total ad revenue but says the report

Industry analysts say that now, with the introduction of Apple’s iPad tablet, an entirely new approach to mobile ads could be near.

Don't write off print advertising just yet

According to a survey seen by the Times,print advertising is more than twice as effective as television advertising for large retailers.

The survey of 26 large retailers found that

Every £1 spent on print advertisements yields £5 in revenue, compared with £2.15 for television and £3.44 for online advertising,

Print is very good for targeting specific audiences and getting eyeballs on key products,” said Joel Dawson, head of online marketing at Boots. “But the smarter businesses are integrating digital advertising into the planning process.”

Ht-Joanna Geary

Ads work better on search than social

Whilst on the topic of search,research from Mintel suggests that consumers are more likely to pay attention to ads on search engines and price comparison sites than on social networks.

New Media age reports that

consumers are most likely to pay attention to ads placed on search engines (54%) and price comparison sites (43%) than social networks (28%) and email (22%).

But there is also a gender issue

Women are more likely to see ads on social networking sites, 47% compared with 41% of men. But men are more likely to see ads when consuming on-demand video content as just 27% of women had seen an ad around VOD content compared with 36% of men.

Video the way for online ads to go?

Online ads are booming but only if they are attached to video.

According to this report in the New York Times,

CNN.com and ESPN.com are featuring video much more prominently on their home pages, often prompting visitors to press play before they begin to read. Even The Wall Street Journal has moved its video player front and center with a twice-a-day live newscast on WSJ.com.

The reason quite simply is that video is benefiting from the higher cost-per-thousands, or C.P.M.’s, that ads on those videos command.

The attention to video mirrors changes in how consumers are experiencing news. Major events — be it the presidential election or the death of Michael Jackson — bring a surge in video stream viewings by new users, and each time some of them stick around.

Social media ads continue to rise

Interesting August saw social networks accounting for 25 per cent of all online ad impressions.

The study by Com Score showed that social networking sites accounted for 13.8 billion display ad impressions in August 2009,

Telecommunications companies, including Telefonica O2, Deutsche Telekom, and British Telecommunications, were the heaviest social networking site advertisers, delivering more than 949 million display ad impressions on social networking sites in August, or approximately 7 percent of all display ads delivered in the site category. The retail advertiser category, which includes leading brands such as DFS, Tesco, and John Lewis, ranked second with 753 million display ad views, followed by banking brands (e.g. Barclays and HSBC) with 248 million, travel brands (e.g. Thomas Cook and Travelzoo.com) with 213 million, and entertainment brands (e.g. Sky and Sony) with 181 million display ad views.

via new media age

Will social media be the new conduit for online advertising?

An interesting point on social media's impact on advertising from Jo Wadsworth

social media allows brands to bypass mass media entirely. And it's not just commercial brands - it's also local authorities, celebrities, politicians, lots of the people who previously relied on the papers to get their message out there.

who also draws our attention to this report that makes it clear that Social Media is a better investment than banner advertising.

1. 2-3%: percentage of all banner ad traffic actually engaged with the target brand
2. 3 seconds: the average time users remained on target site from a banner click
3. £££s: cost per single engagement during four week campaign was 23 times HIGHER than that of equivalent Social Media campaign

Ht-Sarah Hartley

Before we herald the death of TV advertising..........

The much trumpeted statistic that online advertising has now surpassed that of television comes as no real surprise.

The report by Price Waterhouse Coopers for the Internet Advertising Bureau shows that online advertising rose to 23.5 per cent of the total market in the first half of this year, while TV was on 21.9 per cent.

But before we all start ringing the death knell of the tradition forms,it may be a good idea to step back.

As the FT points out in this comment piece

Online marketing is still at the utilitarian end of the ad spectrum. It is better at helping consumers satisfy needs they have already identified than persuading them to buy products that they had not previously thought – perhaps rightly – that they needed. If internet advertising is to capture the 30 per cent market share that its most fervent supporters believe could be in its grasp, then it needs to capture more high-profile campaigns and attract a greater share of consumer brand marketing.

There are also two rather looming issues as the piece continues

1. continuing pressure on UK TV advertising sharpens questions about how to pay for public service broadcasting beyond the BBC.

2.Privacy-Being able to tailor web adverts to users’ preferences, based on individual browsing patterns, is part of the internet’s appeal for advertisers. Some online users will readily trade privacy for the convenience of avoiding irrelevant advertising. But others may feel uncomfortable that this information is collected and sold.

Raymond Snoddy also has some issues.(via Michael Taylor).

In this piece at MediaTel he argues that although it is

a symbolic moment. Television has been beaten into second place after nearly fifty years by a medium that could scarcely be glimpsed on the horizon a decade ago

he points out that

online search and comparison sites scramble over each other to advertise on network television. Presumably they must all believe in the effectiveness of television advertising.

Human shoppers might be turned off by the tricks of Google rankings

Staying on the subject of online advertising,a study by Engine Ready, an Internet marketing company,suggests that

visitors who get to retail sites through sponsored links are more likely to buy than those who click on organic results. They also spend more; the average order of a paid linker was $11 higher, at $117.06.

It suggests that

human shoppers might be turned off by the tricks that make a site show up higher in Google rankings. In particular, Google’s Web trawling software is lured by pages with lots of material. “When we’re optimizing for search engines, content is king,” Mr. Smith said. “But less is more when engaging a visitor.”

via New York Times

Slow online growth makes new bedfellows

The slow growth of online advertising is pushing internet companies and ad agencies to work together.

That is according to an article in the New York Times.

With consumers spending more and more time online, analysts say Internet companies and ad agencies have no choice but to work together to develop ways to make money from digital media.

says the paper.

Advertising downturn will accelerate the move to digital

A rather downbeat report on advertising from Pcw is reported in the FT this morning.

the UK’s television advertising market will resume growth after 2010 but may not surpass 2008 levels until after 2013.

But the report adds the current slump may well accelerate the move to the digital advertising platform but

that will not be enough to offset the decline in traditional businesses.

although

the move to digital advertising, with greater scope for targeting specific groups, allowed advertisers to be more efficient in their spending.

Why advertisng is a failure

Jeff Jarvis writes some reflective words on the role of advertising into today's internet business model.

Starting with the premise that advertising is in fact a failure

Ideally, a company offers a great product or service that its customers love, talk about, and sell to each other. It's when that fails that you need to advertise.

the internet means that

Selling scarcity in advertising - limited time, space, or eyeballs - is outmoded now that we have a medium that creates an abundance of connections with people; that enables relationships instead of mere messaging.

Online advertising more prolific that we think

Amid all the discussion about whether online advertising will fill the gap produced by the decline in the print version,Gordon Borrell in this post thinks that there is a lot more around.

The amount advertisers are spending is truly stunning, and much larger than most people imagine. Those who understand the true breadth of opportunity are more likely (in my humble opinion) to get a larger share than those who underestimate it.

and the reason why?

“With the Internet, however, you can’t fathom the universe of companies and individuals selling things like email advertising or search advertising or banners. In a lot of cases, they aren’t even companies, but individuals who don’t have business licenses and thus cannot be tracked at all for their “ad revenue” receipts.

Ht-Nieman Lab