Tuesday, 21 December 2010

Online ad value now exceeds newspapers

The Wall Street Journal has published a summary of new research in the US by eConsultancy which estimates that advertisers will have spent more on Internet ads than on print newspaper ads in the past year. Figures for US spending on online ads are expected to hit $25.8 billion, which is higher than the $22.8 billion spent on print ads in newspapers.

This change has been expected for some time as the gap was rapidly closed between the two types of advertising media and as the Internet became more maintstream. As the article says, the online platform provides many more options for news although newspaper publishers can't charge as much for ads online as they can in print. Therefore while the total audience for many newspapers may have grown in recent years, the publishers have been unable to stem revenue declines.

Other research mentioned by the article includes recent findings by Forrester Research which show that US consumers are now spending as much time online as they do watching television. But they aren't necessarily spending less time in front of their TVs, so the media that are seeing a declining share of usage are radio and print newspapers / magazines.



Tuesday, 9 November 2010

Australian Internet advertising spend continues to grow

The latest quarterly report from the IAB Australia shows further growth in online advertising expenditure in Australia. Another record quarter of $571.75 million in spend reflects a 23% year on year growth, up by $105.5m.

The Online Advertising Expenditure Report (OAER) shows that there was annual growth in all the categories tracked - general display (26%), classifieds (30%), search and directories (18%) - for the July-September period compared to 2009. The classifieds category showed the strongest growth for the quarter, following some declines in expenditure over the previous year, whereas search and directories is showing a slower level of growth in an already strong sector.

General display advertising and classifieds advertising accounted for 26.5% and 24.6% respectively of the total advertising expenditure for the third-quarter 2010, while search & directories advertising comprised the remaining 48.9% (a slight decline in share compared to the previous quarter).

Within the general display category, email based advertising comprised $7.6m of advertising expenditure, while video based advertising comprised $8.4m of advertising expenditure, slightly down on Q2 2010. CPM based pricing continued as the dominant expenditure type with 75% of advertising expenditure on a CPM basis, and 25% on a direct response basis.

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Tuesday, 28 September 2010

IAB seeks online measurement system

The Interactive Advertising Bureau of Australia (IAB) has announced that they are searching for tenders from companies to develop an online audience measurement (OAM) system. The successful company will then be endorsed as the sole and exclusive preferred supplier for the planning, buying and reporting of OAM for an initial three year period.

Paul Fisher, the CEO of IAB Australia, said that the Bureau had "liaised extensively with our IAB cousins in the US, UK and EU to learn from their experiences regarding OAM technology, models and partnerships. It is clear that a standard OAM currency is one of the most significant contributors to the growth of online advertising and we have been working hard to assist industry to arrive at such a result."

Audience measurement is becoming increasingly vital in the expanding online advertising market and the hope is that Australia will benefit from more robust ratings, readership and audience data so that advertisers will be able to make better media-buying decisions. However, as has been seen in other markets, any primary measurement system for online usage will never be perfect and have detractors, but it is still needed as an industry-wide tool.

OAM companies must register their interest in participating in the process by Friday 8th October 2010 and the deadline for final submissions will be 17th December 2010. The winning bid would then be announced in the first half of 2011, with the new measurement system expected to be in place during the second half of that year.

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Friday, 24 September 2010

Nielsen tests new display advert metric

The Wall Street Journal reports that research company Nielsen is working on a new measurement service that would offer advertisers and website publishers a new stream of data to improve audience measurement for online advertising. As with TV ratings, the new service requires the participation of media outlets - in this case Web portals and other sites - and the firm has reportedly lined up Facebook as a participant. Other websites are expected to join as it moves out of the testing phase.

The new stream of data would be an "online GRP," which is short for Gross Rating Points - a formula that measures the reach and frequency of an ad, a method that has been used by the TV business for decades. To get the new data, Nielsen will blend its demographic panel data with information from participating online companies about the people seeing a particular online ad, according to people involved in the research.

Information will vary from website to website, but in general it might indicate the age group and sex of a particular web surfer and maybe even location. However, only anonymous data will be given to Nielsen for the service, according to several people involved in the process.

Marketers often use site traffic as a gauge when they decide to buy Internet display ads - the ads that include graphics and text and appear alongside the border of the page. But traffic alone isn't a perfect indicator of an ad's effectiveness. When people click on the ads, their specific actions can be tracked. But display ads are clicked on just a fraction of the time. That leaves room for an additional layer of measurement.

Media buyers say having an online GRP has the potential to give marketers a way to do apple-to-apple comparisons of media. Having the information, they say, could lead to advertisers shifting more of their ad budgets to the Internet from other media like television.

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Friday, 28 May 2010

Google gaining display advertising share

MediaPost reports that Google and Facebook are gaining a strong share of the display advertising market. Taking the latest data from market research firm IDC, the article says that Google's rise in display advertising has been so swift that the company now poses a serious threat to the biggest players in the segment - Yahoo and Microsoft.

Much of this growth in display advertising is attributed to YouTube, which is owned by Google, and the acquisition of DoubleClick in 2007. In fact Google has now overtaken the No. 3 company in the category, AOL - which had 6% share in the first quarter -and is now likely to push Microsoft, with a 9.5%, share, out of the No. 2 slot by the end of the year if current trends continue.

That would leave Yahoo as the remaining target for Google. The research indicates that Yahoo's share was 16.5% in the first quarter of 2010, but has been stuck at about 16% for the last five quarters. Facebook is also coming on strong too, although not quite as fast as Google. The world's largest social network has already surpassed News Corp. and CBS, the former No. 4- and 5-ranked companies in display, is poised to catch up to AOL within the next three to four quarters, based on the IDC figures.

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Wednesday, 14 April 2010

Twitter announces new advertising scheme

As reported widely in the press, including The Wall Street Journal, Twitter has announced a new advertising model that they hope will start earning some significant revenue for the microblogging service. Called Promoted Tweets, the ads will appear at the top of results for searches users conduct on Twitter. Eventually, they may appear in the stream of posts users see when they log into the site.

Twitter is gradually rolling out this advertising to users and there are 10 initial advertisers taking part, including Starbucks, Virgin America and Best Buy. The company will start by charging marketers per thousand impressions of their ads. Over time, it plans to move to a more complex model, charging based on how users interact with the messages.

The article says that this new feature could appeal to the millions of businesses who have created accounts on the service to share deals and other corporate updates. Instead of getting users to follow their messages, they will now be able to push their message to users who search any keyword they buy. However, what impact this advertising will have on Twitter's millions of users will have to be seen.

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Friday, 5 March 2010

Google adds new function for brand advertisers

The Google AdWords blog has announced a new feature to help brand advertisers who use the AdWords content network. Although most AdWords campaigns are aimed at achieving a direct response from the advertising, brand advertisers tend to use display ad formats to raise awareness and purchase consideration for a product or service a person might buy at a later date (or often a combination of the two).

Google has now added a new feature which filters out "below the fold" inventory - that is, ads that might be served up onto a webpage, but are not actually seen by the user if they don't scroll down the page far enough to see the advert. This will enable brand advertisers to be more selective about where ads appear as the filter allows them to choose to show ads only in places that appear on the user's screen when the page loads, without requiring them to scroll down.

Google's blog says that with a host of different web browsers, monitor sizes, and screen resolutions, it's hard for advertisers to predict where an ad will land, since the same placement may appear differently on each user's screen. Therefore to simplify the process, Google has implemented a statistically driven solution to determine which ads are above and below the fold. This statistically driven model only considers ads "above the fold" if they are completely on-screen when the browser window loads.

This is an interesting development and one that should help brand advertisers monitor and control their advert performance and to get a better understanding of how well these work across different sites on the content network.

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Thursday, 17 December 2009

Advertisers to spend more online in 2010

New research by US company Round2 Communications says that 72% of advertising companies will increase their online marketing spending in 2010. A summary of the results have been published by Media Daily News and explain this trend towards online spend because 33.9% of respondents said that ROI (Return on Investment) for new media is "somewhat" better than traditional advertising, and 28.2% said new media's ROI is "significantly" better.

As a result of this growth in spend on digital media, the more traditional channels (such as TV, radio, newspapers and magazines) are expected to lose out, with 86% of respondents saying that they expect their spending to remain even (45.7%) or decline (40.3%) in 2010. However, print still remains the most dominant media channel with 47% of respondents saying this is their single biggest media investment, well ahead of email marketing (13.4%) and interactive advertising (10.2%).

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Wednesday, 16 December 2009

Search and video advertising main growth areas in the US

Media Post has reported on new research in the US by eMarketer that shows online advertising declining by 4.6% in 2009 - the first drop since 2002 - although this is expected to grow again in 2010. The two areas that saw growth in 2009, however, were search and video advertising.

The eMarketer report identified a move towards 'non-advertising' marketing, such as social media and building websites or brand 'microsites'. This means that spend is being channeled into other areas not previously tracked by the research, so that the annual decline in figures may be misleading. The use of social media is also having an impact on how online advertising is being used and how communication channels are changing.

The search marketing sector is shown to be taking a larger slice of the online budget, as it is in Australia as well. The US figures show spend under $11 billion in 2009 growing to nearly $16 billion in 2014. This will make the sector about three times as big as banner or video campaigns. However, although search advertising will see the largest annual increases through to 2013, according to this research, by 2014 it is expected that more new dollars will flow into video advertising than into search.

This expected growth in spending on video ads will far outpace any other online format, running between 34% and 45% from 2009 through 2014 and is the result of video ads moving to a position as the main form of brand advertising online. By 2014, it is estimated that US advertisers will be spending 46.5% of the online advertising market on search and 38.7% on a mix of banner, video and rich media display ads.

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Tuesday, 24 November 2009

Google to acquire Teracent

Google has announced the acquisition of Teracent, a US-based technology company that can generate and customize the different creative elements of online adverts, automatically choosing new elements in real-time, by machine-learning algorithms.

This new technology is designed to improve conversions by picking and choosing from literally thousands of creative elements of a display ad in real-time — thereby tweaking images, products, messages or colors in response to activity data. These elements can be optimized depending on factors like geographic location, language, the content of the website, the time of day or the past performance of different ads.

As the importance of conversion rate and ROI increases in a crowded webspace, the new technology from Teracent can help advertisers get better results from their display ad campaigns which will also enable publishers to make more money from their ad space and delivers web users better ads and more ad-funded web content.

As is usual with Google's acquisitions, the company has identified a technology developer with a huge potential in the future and one that will complement Google's services, as well as benefit fro the additional investment and programming input. Google intends to make the technology available as soon as possible to display advertising clients, such as those using the Google Content Network and through the DoubleClick network.

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Monday, 16 November 2009

Online video ads perform better next to content

MediaWeek reports on a new survey from third-party ad server Eyeblaster, which suggests that online video ads placed on social networking and gaming sites don’t have the same success in terms of 'user engagement' compared to content sites and email.

The company examined data from thousands of campaigns that had been run for brands over the past year and specifically focused on two key metrics - Dwell Rate (which measures the proportion of ad impressions that resulted in a user engaging with an ad, such as mousing over it or clicking on it) and Dwell Time (which measure the amount of time users spend engaged with a particular ad).

The results showed that overall, online video increased both Dwell Rate and Dwell Time when compared to other forms of online advertising, but also that online video tends to perform better when adjacent to content or email than in social media and gaming environments. This probably reflects the reason for the different types of site usage in the first place, although video sharing is becoming a more important component of these type of sites.

Eyeblaster found that people tended to browse social networks really quickly and so auto start video ads often didn't have a chance to actually start, plus people have few opportunities to stop and linger like they do on content sites due to the different browsing habits on the social networking or gaming sites.

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Monday, 28 September 2009

Social networks display substantial annual growth trends

The ClickZ website has summarised new data released by The Nielsen Company which says that the time being spent on social networking sites has nearly tripled in the past year. In addition to this trend, the amount being spent on advertising on these sites has also increased at a similar rate.

According to the report, consumer activity on social networking and blogging sites comprised 17% of all time spent on the Internet in August 2009, up from just 6% a year ago. At the same time, advertising spend on these sites grew 119%, from an estimated US$49 million in August 2008 to US$108 million last month. As a percentage of total online ad spend in the US, these ad expenditures on social networking sites climbed from 7% to 15% year on year.

Not surprisingly, Facebook is the big winner from this growth, as recently reported, and as well as the number of users growing substantially, the time spent on the site has also increased, with the average user now spending 5 hours and 46 minutes per month on the site, up from 1 hour and 40 minutes a year ago. As a result, Facebook has reportedly seen a significant growth in ad impressions, accounting for a 14.7% share of US display advertising views last month, up from just 1.8% in January this year.

According to Nielsen, the spend by industry sector on the top social network sites has increased in all areas, with the entertainment industry showing the biggest annual increase, up by 812%, and travel advertising increasing spend by 364%.

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Tuesday, 8 September 2009

Social networking sites attract advertising share

A report by Reuters says that around one of every five Internet display ads in the United States is now being viewed on a social networking website, such as MySpace and Facebook. The data comes from a new survey by comScore which demonstrates the increasing importance of social media sites and the broadening acceptance of such sites by brand advertisers, as well as the challenge now being faced by the more traditional online publishers, such as Yahoo and AOL.

The new report says that social media sites represented just over 21% of U.S. Internet display ads in July, with MySpace and Facebook accounting for more than 80% of those ads. However, the question will remain as to whether these sites can be used as effectively for advertising, due to the nature of their usage. Also, because the content on social media sites is created by users, some have questioned the willingness of marketers to place their brands alongside that content and the potential risks that could bring.

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Thursday, 3 September 2009

Nielsen's new audience measurement

An article in the Sydney Morning Herald reviews the new Internet measurement panels being introduced by Nielsen, the recognised authority in data for online advertisers. The traditional figures for 'unique browsers' visiting a website are now being reconsidered as a misleading figure, to be replaced by 'unique audience'.

The change comes as part of the relaunch of the Nielsen NetView service, the measurement panel which provides audience ratings for web publishers as part of their advertising sales statistics. The panel has increased to a representative 7000 people, enabling a better view on work and home Internet usage, as well as eliminating the duplication of computers as web browser.

This was essentially the problem with the earlier figures, in that they double-counted people as browsers, whether they might be using the web at work, home or even on their mobiles. The newer unique audience figures will provide more credibility, but in the short term, publishers will see their audience figures decline with the new measures.



Monday, 10 August 2009

IAB figures show growing search advertising share

The latest Internet advertising figures published by IAB Australia show continued growth in the online advertising market which is bucking the general advertising market trends. The latest figures for the April-June quarter and the past financial year show an 18.5% year-on-year growth for the 12 months to the end of June and a 9.8% increase for the quarter.

The Online Advertising Expenditure Report (OAER) is published by IAB Australia using data compiled by PricewaterhouseCoopers. The new figures show that online advertising expenditure in Australia for the year ending June 30 2009 exceeded $1.8 billion and totalled $453 million for second-quarter 2009. This means that Internet advertising is still expected to hit the $2 billion spend level for this year.

In the past financial year, Search and Directories accounted for 49% of the total advertising expenditure and saw a growth of 25% year-on-year. General Display Advertising accounted for a 27% share of the market and grew by 19.6% and Classifieds held a 24% share and grew by just 6% over the previous year.

For the second quarter of 2009, the Search and Directories category increased by 19% on the same period last year, with General Display increasing by 10% and Classifieds saw a decrease of 5.9%. The IAB commented on the report that these latest figures demonstrated the continued confidence in the market for online advertising at a time when the economic situation is challenging.

Not surprisingly, search advertising continues to do well and is driving the growth in the industry due to its targeted and measurable nature, although the bulk of the figures in this sector remain estimated since Google does not reveal these to the IAB researchers. Display advertising is also showing continued support as a growing medium as Internet usage continues to develop. Not surprisingly, however, is the decline in online classified spend which has been impacted by the declines in the employment, real estate and automotive markets.

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Tuesday, 23 June 2009

Yahoo! launches self-serve tool for display advertisers

Advertising Age reports on the new self-serve advertising product launched by Yahoo!. Called 'My Display Ads', this tool is intended to make it easier for local advertisers and existing search advertisers to try more display advertising on the web. This sort of tool is already provided by Google and Facebook, but Yahoo! has the advantage of a large display advertising inventory which it now wants to develop, including linking search advertisers with the benefits of running display ads at the same time to improve conversions.

Advertisers can choose pre-designed creative layouts from more than 800 display ad templates, or they can make their own by using the simple management tool or by uploading new designs. Ads can then be purchased on a cost-per-thousand impression basis or as part of a cost-per-click auction.

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Thursday, 4 June 2009

New research shows importance of conversions

New research published in the US has been reported in AdWeek and demonstrates how the Internet is still seen as a powerful direct marketing tool where conversions are far more important than brand building. The survey of top marketers was carried out by Forbes.com and, when asked what measures they used to gauge success, just 31% of respondents said brand building topped the list, and 14% said reach. However, direct marketing metrics scored highly, with around 82% identifying conversions as the leading gauge, 55% said registrations and 51% said clicks.

These attitudes reflected well for search and e-mail marketing compared to display ads and video as the research shows that SEO, pay-per-click ads and e-mail were identified as the most effective means of generating conversions, whereas video and display ads were at the bottom. The article says that the whole area of metrics - which the Internet excels in - should still embrace more traditional brand-based advertising by including more brand-health measures and embracing frequency online, which can drive up perceived costs in a cost-per-impression model.

The research showed that the most common digital marketing approaches were the more 'traditional' e-mail and search optimisation campaigns - used by 74% of respondents - in contrast to the 38% that were using cost per thousand (CPM) campaigns such as display advertising, or the 28% saying they used video ads.

85% of respondents said they were satisfied with their search engine optimisation efforts and 78% were positive about the results from search advertising. Impression-based advertising scored lower, with a 63% satisfaction level and just over 50% were pleased with ad networks, which scored lowest. In terms of future plans, viral marketing, SEO and behavioral targeting were the tactics most frequently identified for budget increases in the next six months.

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Monday, 11 May 2009

Internet advertising in Australia continues to grow

The latest quarterly report from IAB Australia shows that the national online advertising market continues to show a good rate of growth, with a year-on-year increase of 14%. Using data compiled by PricewaterhouseCoopers (PWC), the online advertising expenditure in Australia for the first quarter of 2009 came to $439.5 million, the largest first quarter figure recorded so far.

The online advertising industry is expected to be impacted by the effects of the global financial crisis and the lowering of consumer and business confidence. The first quarter figures for 2009 were down 5% against the last quarter of 2008, yet this was anticipated due to the decline in activity that's usually seen after the pre-Christmas period. Despite this, the online advertising sector continues to maintain a strong year-on-year growth each quarter, unlike most other advertising media that are reporting negative year-on-year revenues.

The continued growth in this sector has been largely driven by the Search and Directories sector where the further migration of revenues into this sector saw it push past 50% of the total online advertising revenue for the first quarter. General Display advertising accounted for 24.9% of the total advertising expenditure for the first quarter, with a small decrease from the previous quarter as expected due to the trend of previous years. The Classifieds sector comprised 23.9% of the overall market with the impact of the economic slowdown having the greatest impact here, as the sector showed the first decrease in year-on-year expenditure since record keeping commenced in 2002.

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Tuesday, 10 February 2009

Internet advertising grows by 27% in 2008

The new figures for Internet advertising in Australia have been posted by the Internet Advertising Bureau, using data compiled by PricewaterhouseCoopers from a sample of over 1,000 website properties in the country.

This latest data shows that overall growth in this advertising sector for the past year was up by 27% to the forecasted figure of $1.7 billion - a growth of $364m on the 2007 figure of $1.34 billion. The market is now expected to break the $2 billion barrier by the end of this year, although growth rates are slowing and the current economic situation may hinder this growth (or potentially increase it as more spend in channelled online and away from other media).

The Search and Directories category remains the main growth area, although since Google refuses to reveal their numbers, the figures remain a significant estimate. However, year on year this category grew by 30% to $807m. In the fourth quarter of 2008, the sector grew by 27% compared to the same period in 2007, to $224m. It also grew by 6% over the third quarter in 2008, which is the critical figure as the 'credit crunch' began to bite during this period.

Of the other 2 monitored categories, Display Advertising grew by 27% in 2008 to $465m and by 24% year-on-year in the fourth quarter, to $130m. Compared to the third quarter in 2008, this marked a 4% growth in advertising spend. Finally, the Classifieds sector grew by 23% for the year, up to $439m, and by 10% year-on-year for the quarter, to $108m. However, compared to the third quarter, this sector shows a drop of 5% - the first ever and possible signs of the slowdown affecting online advertising.

The detailed summary of these figures can be downloaded as a PDF report from the IAB website.

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Friday, 5 December 2008

Internet advertising in a strong position for the economic downturn

A recent article by The Economist is one of many that highlight the strength of the online marketing sector during the current period of economic crisis, with search advertising in particular looking to gain from the latest trends. Online advertising data from the US, the UK and Australia, all show that Internet advertising, and spend on search marketing in particular, continues to grow, although at slower rates than the previous few years.

Search advertising has become less of a speculative medium in recent years and instead provides highly measurable and responsive data from a focused marketing activity that gets excellent results for many companies. This makes it a surer option when advertising budgets may be getting cut back and therefore further growth in this sector is likely over the next few years.

The opportunities for advertising through video channels, like YouTube, and social networking sites like Facebook and MySpace are also seen as good opportunities, although these have yet to prove themselves in the same way as search. That's because these channels are used in different ways to search - more for socialising and viewing content, where advertising may be seen as more intrusive. Yet these areas are still seen as a good opportunity for developing new and creative techniques that will become more acceptable with users.

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