Study: Web Promotions to Triple by 2012
The interactive capability of the Internet is taking hold among advertisers and is about to eclipse traditional banner- and paid-search advertising, according to a new study from Borrell Advertising to be released Tuesday, April 29.
Katy Bachman
APRIL 28, 2008 -
The interactive capability of the Internet is taking hold among advertisers and is about to eclipse traditional banner- and paid-search advertising, according to a new study from Borrell Associates Inc. to be released Tuesday, April 29. Over the next five years online promotions, including contests and coupons, is expected to triple from $8 billion last year to more than $22 billion by 2012.
Currently non-ad online spending is only 22 percent of the total $37 billion spend in online advertising. But that's about to change, more in line with total marketing expenditures. Of the total $806 billion spent in marketing, 60 percent of the dollars are allocated to non-ad spending versus 40 percent allocated to traditional advertising.
For the past two years, spending on online display ads, banners and pop-ups has been flat. The ad format is forecast to peak this year at $12.6 billion, and then begin to decline to less than half that amount over the next four years. Paid search is facing a similar spending trend, peaking next year at $16.9 billion and then gradually declining.
"Online contests, giveaways, coupons and sales of half-price gift certificates are proliferating, many of them bringing in hundreds of thousands of dollars annually and generating warm partnerships between the media company and the advertiser," the Borrell report said. "Local media companies that are genuinely helping those businesses grow, rather than merely selling advertising to them, are well positioned to succeed in this brave new world of marketing."
The shift to online promotions is indicative of a larger trend among marketers to obtain measurable campaign results.
"The inability of newspapers magazines, radio, and TV to prove return on advertising investment has led to a swing toward promotional spending," the Borrell report said.
For now the trend seems mostly confined to national advertisers, but the opportunities for local media companies are "abundant," Borrell said. "The smartest of the lot have already begun the shift from mere selling to collaborating with their advertisers," Borrell said.
The local medium best positioned to take advantage of the trend could be local TV. A survey from BIGResearch, cited in the Borrell report showed that 37.7 percent of people that were online were also watching television; 21 percent were listening to radio; 9.3 percent were reading a newspaper; 6.8 percent were reading a magazine.
Katy Bachman
APRIL 28, 2008 -
The interactive capability of the Internet is taking hold among advertisers and is about to eclipse traditional banner- and paid-search advertising, according to a new study from Borrell Associates Inc. to be released Tuesday, April 29. Over the next five years online promotions, including contests and coupons, is expected to triple from $8 billion last year to more than $22 billion by 2012.
Currently non-ad online spending is only 22 percent of the total $37 billion spend in online advertising. But that's about to change, more in line with total marketing expenditures. Of the total $806 billion spent in marketing, 60 percent of the dollars are allocated to non-ad spending versus 40 percent allocated to traditional advertising.
For the past two years, spending on online display ads, banners and pop-ups has been flat. The ad format is forecast to peak this year at $12.6 billion, and then begin to decline to less than half that amount over the next four years. Paid search is facing a similar spending trend, peaking next year at $16.9 billion and then gradually declining.
"Online contests, giveaways, coupons and sales of half-price gift certificates are proliferating, many of them bringing in hundreds of thousands of dollars annually and generating warm partnerships between the media company and the advertiser," the Borrell report said. "Local media companies that are genuinely helping those businesses grow, rather than merely selling advertising to them, are well positioned to succeed in this brave new world of marketing."
The shift to online promotions is indicative of a larger trend among marketers to obtain measurable campaign results.
"The inability of newspapers magazines, radio, and TV to prove return on advertising investment has led to a swing toward promotional spending," the Borrell report said.
For now the trend seems mostly confined to national advertisers, but the opportunities for local media companies are "abundant," Borrell said. "The smartest of the lot have already begun the shift from mere selling to collaborating with their advertisers," Borrell said.
The local medium best positioned to take advantage of the trend could be local TV. A survey from BIGResearch, cited in the Borrell report showed that 37.7 percent of people that were online were also watching television; 21 percent were listening to radio; 9.3 percent were reading a newspaper; 6.8 percent were reading a magazine.
posted by Donna Clayburn at 2:47 PM
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