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Posts Tagged ‘online advertising’

Online ad networks: evil or useful? Wednesday, May 20th, 2009

Shameless self-promotion: We published an article the other day on the HotHouse blog about online ad networks. There’s an accompanying podcast interview with APAC Digital MD David Holmes. The HotHouse blog is full of news and opinion on developments in the online space.


Online video on the rise Tuesday, March 31st, 2009

One of the topics getting an increasing amount of airplay is online video. It’s growth is bucking the downward spend pattern of most other forms of media. Here are just a few of the articles worth reading on this trend:

  • Is the Big Shift Underway? Talks about how relatively high CPMs compared with television to grab large audiences has been holding back the growth of online video. One of the comments on the story says, “We think there is another business model emerging for brands leveraging video on the Web: Brands hosting video content on their own site instead of running ads around someone else’s video at an aggregated site. Our vision is that brands will soon realize that a person watching video content on a brand’s website are easily worth 20 times the value of a viewer offsite watching an ad. We think a new metric will soon be developed. And it will define the ROI of brands creating their own engaging, fun content on their own websites that visitors want to see.”
  • Online Video Changes Game for Brand Marketers: “Video has expanded well beyond the media industry and into nearly every corner of the professional Web, as corporations, governments, non-profits and educational institutions look to use video as a cornerstone of how they communicate, market and inform on the Web.” Has some good case studies on the effective use of online video.
  • Online Video Subtitles (Duh!): Predicts that spending on online video advertising will grow by more than 50% a year for the next five years to more than US$5.8 billion by 2013. Cites research showing that adding subtitles to videos increased time spent viewing by more than 40 per cent.

Will be interesting to, um, watch what happens in Australia in this part of the online market.


Hard to measure branding impact, but it’s there Wednesday, January 7th, 2009

Online Media Daily has published a commentary piece on the difficulties of measuring value online and the implications for online branding. It is a bit dense, but well worth reading carefully. In summary, Andy Atherton argues that 1) Something that is valuable is not necessarily directly measurable, because value can be difficult to measure; and 2) No model can substitute for relevant experience and common sense. Models aren’t always right.

To support his argument, Atherton quotes a recent study from the Atlas Institute which concludes that about 60% of all paid search clicks are on branded terms. Calling that number “simply astounding,” Atherton writes that ”Obviously Atlas’ parent company, Microsoft, has a vested interest in moving the market away from an excessive focus on Search, so skepticism is warranted. However, even if we cut that percentage in half, the inescapable conclusion is that a lot of the money brand marketers are spending on other media (online and offline) is having an impact - even if we can’t measure it precisely. 

“The other just as important and also equally inescapable conclusion is that marketers who only spend on search are losing potential sales to those marketers who use the full funnel. A consumer who begins by searching for ‘Campbell’s Soup’ must be more likely to end up buying Campbell’s Soup - versus buying Progresso soup or any other brand - than if they began by just searching for ’soup.’ ”

He concludes that, “Accountability is always good. However, accountability should never be a mandate (or an excuse) for doing only things that can be precisely measured. Just because we can’t measure something as precisely as we would like, doesn’t mean that thing is not valuable. That’s point #1.   

“Point #2 is that a measurement itself is only as good as the model on which it’s based. Models are a complement, not a substitute, for experience and intuition. 

“There’s an interesting parallel to be drawn with the current financial crisis. An army of ‘quants’ had built complex and impressive models explaining how return could finally be separated from risk. Some experienced investors, following their own common sense, avoided this trap - Warren Buffet comes to mind.  Often common sense is the best sense of all.”


Top viral ads and buzzwords Monday, January 5th, 2009

OK, last word on 2008 wrap-ups - check out a comprehensive list of top viral ads, buzzwords of the year and holiday viral campaigns at the Big Wave Blog.


More 2009 predictions Monday, December 29th, 2008

Here are some more predictions posted about online growth/trends for next year. Social media manager Roger Harris predicts that Twitter will go through consolidation and integration phases in 2009 (BTW, I found this link via a Twitter connection), use of viral video will increase, and social media will be used internally by large companies for ‘management efficiency gains’.

Meanwhile, BusinessWeek says that accountability and compelling user experiences are two reasons why online advertising will be the only sector of the advertising industry to experience growth next year (albeit only 6-10% growth, less than half of pre-GFC predictions).

The power of word of mouth marketing is another reason why online will be the shining spot in a dark year. Jeffrey Rayport writes that, “It’s not that online advertising will supplant traditional media. It won’t. But a new and different ad equilibrium will emerge from the coming economic recovery - and it will represent a radical shift from anything we’ve known before. “


…and this is the year that will be Thursday, December 18th, 2008

There are heaps of opinions about what will be hot and not next year. Here’s a quick guide to expert predictions for social media and e-marketing in 2009:

  • Peter Kim – 50 Social Media &Marketing Predictions for 2009: Fourteen different experts were asked to give their predictions. The list includes: “Obamamaniacs will spawn a new age of activism”, “Social media creates indigestion”, “B2B figures it out”, and “Your ad agency will be disintermediated – by a media company.” My favourite quote from the pundits: “Suddenly, being Facebook friends with your Mom will seem less strange than following 4,000 strangers on Twitter.”
  • Investment bank GP BullHound, cited by NetImperative predicts that: “The mobile industry will see renewed interest and growth in 2009 following the success of the iPhone and developments such as the Gphone resulting in consumers taking ‘PC’ habits with them on the road.”
  •     “Online fashion retailers are also likely to display unprecedented growth as consumers shift spending from the High Street to online.”
  •     2009 will be a tough year for digital publishers with many expected to drop out of the list having either been acquired or have felt pressure on advertising revenue.
  • From ClickZ comes the prediction of all predictions: “The coming year in advertising is predicted to be, if nothing else, unpredictable.”
  • From eMarketer: Online advertising growth will be 8.9% in 2009 – much stronger than traditional advertising, but at a rate halved compared to predictions earlier in the year.
  •  From Frontiering Talk: Video streaming from mobiles - “Soccer mums through to corporate presentations will be beamed from mobiles directly to the internet”
  •     Integrated campaign metrics - “The holy grail of marketing will get one step closer as technology starts to allow a more integrated metrics reporting of campaign media.”
  •     “Attention Surplus Disorder” will be coined as a condition that affects a growing number of people.
  •     “Opinion fraud” will become commonplace with companies paying for positive recommendations for their products and services.

What are your predictions, serious or otherwise? Please let me know via the comments section, and good luck in 2009.


Shirt-folding beats political history Thursday, December 11th, 2008

Attended the Thoughtworks Quarterly Technology Briefing in Sydney yesterday, where the heads of News Digital Media (Sue Klose) and Fairfax Digital (Pippa Leary) outlined developments in online media in Australia, and picked up some interesting facts about Australian online media consumption:

  • There are two spikes in visits to online news sites - at the beginning of the workday, when people check the news headlines; and at lunchtime, when they eat lunch at their desk and go for more entertainment info and videos
  • 35,000 people watched the live stream of Barack Obama’s victory speech on Fairfax Digital. That same day, a video on the site about how to fold a shirt was viewed by 39,000 people
  • Fairfax is claiming 2 million unique user per month just to its business and finance content, with 25-30 average page impressions per user
  • Online video advertising is expected to reach US$2.9 billion in the US in 2009 - 13% of the online advertising total - but the figures for Australia are expected to be only a fraction of that

‘Glimmer of hope’ for online ads in recession Monday, December 1st, 2008

Everyone agrees advertising overall is tanking as a result of the ‘GFC’ (global financial crisis), but how online advertising will be affected is a matter of intense debate. The online industry, naturally, is bullish on the prospects for online ad spend growth, but what do the battered finance and political media think? The Economist entered the debate last week, saying that although online ad spending in the US fell by 27% during the dotcom recession, ”the web has changed a lot since 2002. Back then, gaudy display “banners” on web portals such as Yahoo! and MSN were the preferred technology. These still exist, but they now account for less than 20% of online ad spending.”

As they pointed out, more than 50% of online ad spend now goes to search advertising, while in brand advertising, rich media ads are taking over from banners. Because these forms of advertising are easily tracked, spending on online advertising is now “much less speculative, so that it starts to be treated instead as a cost of sales. This is one reason why online advertising should suffer less than other sorts.”

This still leaves the problem of how advertising spend is transferred from traditional advertising to online. As the Economist points out, “At the beginning of the year Jeff Zucker, the boss of NBC Universal, a big television and film company, told an audience of TV executives that their biggest challenge was to ensure ‘that we do not end up trading analogue dollars for digital pennies’. He meant that audiences were moving online faster than advertisers, thus leaving media companies short-changed. Now, near the end of the year, the situation looks even worse, as the recession threatens to turn even the analogue dollars into pennies.”

The Economist points out that online traffic is moving towards sites where advertising has so far proved ineffective - such as user-generated content havens like YouTube and social networking sites such as MySpace and Facebook - “and is therefore cheap. This, says Mary Meeker (an Internet analyst at Morgan Stanley), presents an opportunity for innovation and arbitrage by clever marketing managers as they cut their conventional ad budgets. It may also provide a glimmer of hope for the advertising industry as it enters recession.”


Online search growing, but less effective Friday, November 28th, 2008

Australian search advertising should total $869.7 million in 2008, making it the fastest growing segment in the local digital media advertising industry, according to the Australia Search Advertising Market 2008-2012 report released today by Frost & Sullivan.

Keyword sponsorships continue to lead demand accounting for 51% of total revenue ($443 million), followed by online directories ($264 million) and contextual searches ($163 million).

The study identifies that 75% of advertisers are now spending more than 10% of their total media budget on search related activities. This compares with 65% 12 months ago.

However, the key benefits of search advertising, including increased leads, conversions/sales and high return on investment, were all down on last year’s results. A total of 59% of brands that used search ads said it resulted in increased leads, down from 66% last year, while 44% said it increased conversions/leads compared to 49% last year. Only 25% of the advertisers surveyed said search advertising achieved a high return on investment, down from 31% last year.

Frost and Sullivan suggests advertisers will turn to search ads in the economic downturn because of its cost effectiveness.


Brands OK - as long as they’re relevant Friday, November 21st, 2008

eMarketer declares that Millennials aren’t brand resistant, but “irrelevance resistant”. Reporting on the results of a Synovate study released this week, eMarketer claims 18-24-year-olds ”are not solidly opposed to brands themselves, and are willing to spread the word about the ones they like.” 
When asked about their “online brand engagement” in the past month, 28% had talked about a brand on a discussion forum, 23% had put brand-related content on their IM profile, and 19% had added branded content to their homepage or social networking site.
Interestingly, the worldwide figures were similar to those in the US, with slightly higher results for favourite sites and personal start pages:

  
According to the report, “Respondents were most likely to pass on comedy clips (62%), followed by music clips (40%) and clips featuring friends (27%). Almost one out of 10 passed along viral advertising and marketing clips. 

Meanwhile, eMarketer reports that word-of-mouth is an ever-stronger way to market to young people. A recent survey by Alloy Media+Marketing found that uni students thought word-of-mouth was the most useful type of advertising. Samples—always a bonus for students on a budget—ranked second.
Showing that students do still consider traditional media relevant, TV and magazine ads also ranked highly—higher, in fact, than online ads and sponsored Web applications.
 

 

 

 

TV-online video migration continues apace Wednesday, November 19th, 2008

The evidence is gathering that online video is cannibalizing television consumption and revenue. 

An IBM study that polled 2,800 people in six countries has revealed that more than three-quarters of people have viewed video online and nearly half do it regularly. Of those who have watched online video, 15% say that as a result they watch “slightly less” TV, while 36% said they watch “significantly less” TV.

Paying homage to the history of commercial television, 70% of online video viewers prefer the ad-supported model over consumer-paid models. They specify, though, that they prefer watching a commercial before or after an uninterrupted online video, and they don’t like product placement.

Almost 60% of the respondents said they were willing to provide to advertisers some personal information about themselves in exchange for something of value, such as access to high-quality music videos, store discounts or airline frequent-flyer points.

“The industry must find appealing ways to monetize new content sources or risk a similar fate as that of the music industry where value shifted away from core players,” said Saul Berman, the study’s co-author.

Meanwhile, eMarketer reports that while TV revenue growth is slowing, online video revenue growth is soaring - though the overall numbers suggest there is a fair amount of leakage in overall spend.

eMarketer estimates there will be $284.8 billion in total US ad spending in 2008, and TV still garners 25% of those dollars. But in 2009 US TV advertising spending will decline 4.2% to $66.9 billion.

 

“This precipitous drop reflects not only the poor economic conditions, but fundamental changes in the way television advertising is being bought and sold,” says Carol Krol, eMarketer senior analyst. “Although there will be inevitable stumbling as they find their footing, the broadcast networks are making bold and interesting choices in an effort to follow consumers online,” says Ms. Krol. “They are collaborating with competitors, hooking up with online partners and forging alliances that were unheard of just a few years ago.”

Online video ad spending as a percent of TV ad spending is expected to nearly double over the next two years, however it will still only reach 1.7% in 2010 - and still less than 3.5% of overall online advertising spend.

Krol points out that there is still “no clear winning online business model for broadcasters,” and that online advertising revenue growth is less than offline media decline. Which raises the question: where is that money going?


Online advertising stays strong in Australia Friday, November 7th, 2008

Online advertising growth in Australia continued to power along in the third quarter, although things are expected to slow down this quarter, according to the IAB’s latest Online Advertising Expenditure Report, released today.

The B&T newsletter reports that online advertising has experienced a 30% growth year-on-year, with advertisers spending a record $450 million in Q3, $100 million ahead of the same period last year.

While growth is expected to soften in Q4 in response to the global economic crisis, the IAB is still anticipating a 20% year-on-year growth.

While all three categories - general display, classifieds, and search and directories - reported strong growth, search and directories dominated, accounting for $212 million of total spend for the quarter, 33% ahead of the same period last year. 

The finance, computer and communications, and motor vehicle sectors represented 52% of display ads. Recruitment dominated spend in classifieds, followed by real estate and automotive.


Collaboration is the future Monday, November 3rd, 2008

Vin Crosbie has dug up some interesting history in a recent piece for ClickZ. He writes about how, 13 years ago, major media groups in the US attempted to get together and aggregate their stories into a (then huge) news search engine, so that people would come to one spot to look for news.

The consortium, called the New Century Nework (NCN), also planned to create a classified advertising search engine that would draw its content from all those dailies. And it planned to create a single advertising system that would allow advertisers to place banner ads to across any geographic or demographic strata of those newspapers’ Web sites.

As Crosbie writes, “Unfortunately, the nine major newspaper companies were more used to competing against each other than cooperating. With some exceptions, they didn’t loan their best new media personnel to this cooperative effort. They weren’t able to agree upon a CEO from among their own companies for the consortium, ultimately having to go outside and pick an executive without any background in either newspapers or online. Then, when the consortium began launching its services and earning some money, the companies argued with each about who should get what share, despite previous agreements about that. All the while, each of the companies was progressing with its own new media plan that would each compete with their cooperative effort.

So what happened? Within months of launching its first services, the NCN imploded. Within months, Google was started, and it soon launched Google News, which aggregates news stories from all over the world. Meanwhile, the local classifieds service Craigslist grew virally to the point where it now offers free classified advertising for tens of millions of users around the world.

As Crosbie writes, “Nothing today is causing more destruction in the media industries than the companies within each of its sectors failing to cooperate fully with each other. You don’t get to build the world of the future by competing tooth and nail.”

The community-based nature of the Internet and its agnostic approach to information mean that if you want to get ahead, you have to get along.


OK, you’re right, it’s boring Saturday, November 1st, 2008

One of the main reasons online advertising and marketing has taken as long as they have to gain traction in the contemporary media mix is that putting together an online campaign isn’t as sexy as creating a TV commercial. No big production budgets (and accompanying commissions), no hob-nobbing on the sets while eating ridiculously elaborate food from over-priced caterers, no award ceremonies in the south of France, no ‘did you see my ad on 60 Minutes last night - along with 2 million other people?’ Instead, online offers practical, measurable messages aimed at meeting customers at their point of need - effective, but yes, boring.

Kevin Lee wrote a piece in ClickZ this week about creativity in search engine marketing and I started out thinking, “Great, here are some examples of how creativity is used in online marketing!” Unfortunately, Kevin’s message was the same as mine: effective, but boring.

“A creative strategy often includes thinking differently about your product, service, offer, pricing, or buy-flow. If you’re selling a product, do you offer alternative payment options? If a service, do you offer different subscription lengths?” he writes.

“What about your offline business? Is there a way to make your online search and offline shopping behavior sync up better? Consider using offer codes and coupons.”

Consider offer codes and coupons - woo hoo! I’m passionate about the potential of online, but I can see where the agency creatives are coming from - there needs to be some sizzle with this steak. Viral campaigns and some uses of YouTube are the exception (see one of my favourites, the “Will it Blend?” campaign, here) - but this is very hit and miss at present.

Kevin Lee has asked ClickZ readers to send him examples of creativity in search. I’ll keep my eye out for them and share them with you - as long as they’re not about offer codes and coupons…


When you can’t control ‘Whassup’ Thursday, October 30th, 2008

Like it or loathe it, Budweiser’s ‘Whassup’ campaign of a few years ago resonated throughout the world as an irritating but catchy and wildly successful way to promote the beer’s brand. Well, the Whassup guys are back, this time on YouTube, and they’re barracking for Barack Obama - and there’s nothing Budweiser or their ad agency DDB Chicago can do about it. Apparently when the ad’s creator Charles Stone III (gotta love those triple-barrelled American names - grandpa would be proud) came up with the concept, DDB licensed the concept from him for five years - an agreement which finished three years ago.

The Whassup ads first appeared in 1999, just before George Bush was elected US president, and the new video shows what’s up eight years later for the original characters - they’re fighting in Iraq, caught in a hurricane, unable to pay medical bills and attempting suicide as their stock portfolio tanks. In 2008, ‘Whassup’, is change, in the form of Obama.

I feel for Budweiser and DDB, but this is a classic example of social media at work - companies no longer have control over their brand and the way it is used. They just have to embrace it and see what the effect is on their brand and their sales. Look for more of this type of consumer power to come in the future.

You can see the ad, which has already been viewed more than 2 million times, here.


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