Online Advertising : the bulldozer effect you cannot reject

By    John Garner on  Tuesday, April 25, 2006
Summary: Greg Stuart from the Internet Advertising Bureau (IAB) says : Interactive advertising continues to experience tremendous growth as marketers experience its overall effectiveness in building brands and delivering online and offline sales In an emarketer article today statistics from the IAB conducted by PricewaterhouseCoopers (PwC) concerning the trends in online advertising from April 2006 are […]

Greg Stuart from the Internet Advertising Bureau (IAB) says :

Interactive advertising continues to experience tremendous growth as marketers experience its overall effectiveness in building brands and delivering online and offline sales

In an emarketer article today statistics from the IAB conducted by PricewaterhouseCoopers (PwC) concerning the trends in online advertising from April 2006 are available and it looks good for the online advertising industry ! From 2004 to 2005 there was a 30.3 percent increase in overall online advertising.
As usual emarketer provides further interesting details about how these figures can be further interpreted, showing for example that search ads are the most used vehicle for ads and that CPM remains that predominant model of online advertising.
If this area is of any interest to you I recommend reading this article...

On MSNBC there is also an interesting article that goes in to detail on the effect that online advertising is having and this article also refers to the IAB report conducted by PricewaterhouseCoopers.

Merrill Lynch media analyst Lauren Rich Fine estimated spending on Internet ads this year will increase 27 percent, surpassing magazines and the Yellow Pages — both more established media markets

The growth in online advertising is providing enough incentive for companies like Time Warner to provide content previously restricted to AOL subscribers free through ad-supported sites. This is an interesting trend that many online newspapers should be following closely since the sites that require subscription (free or paid) are going to be creating barriers for many visitors, turning them away and thus losing out on advertising revenue !

The online advertising figures are bolstering the general 'feel' that there is not only more and more money being spent online in advertising but also that new trends which I have previously discussed are having a bigger impact than expected. The advertising based TV shows available online mean TV networks are beginning to wake up to this reality !
Another Washington Post an article was recently published explaining how TV broadcasters are starting to really feel the pressure and challenge that the web represents for them :

"The question is, do they partner with those new forms of content or those new providers? Or do they sit on their hands and become less and less relevant," said Jimmy Schaeffler, an analyst with The Carmel Group, a market research firm.

If I can start viewing some great series and documentaries online I will certainly not be unhappy about it and properly explaining that the content is provided to me thanks to the shows sponsors and advertisers will make me pay more attention to them !

I also think it is interesting to refer to the controversial statement from the CEO of France's TF1 who was widely criticised for claiming that the content they broadcast was mainly to get people in the right condition to be receptive to the adverts that follow !
Here is a translation of what Le Lay said :

TF1's business is to help Coca-Cola sell its products ... what we sell Coca-Cola, is available brain time. For an advert to be efficient, the viewer's brain has to be available. The aim of our programmes is to make sure that their brain is receptive, that is to say to entertain them, make them feel relaxed to get them ready between two commercials

So Internet is moving back to the initial model rejected by many, whereby free content is financed by advertising ! Or am I just being to cynical ?

Article written by  John Garner

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