Thursday, September 15, 2005
The Big Battle Over Ad Budgets: "Published: September 15, 2005
A new eMarketer report tracks the flow of advertising dollars to the Internet — and how much of that gain is coming from traditional media.
Internet advertising could be dubbed 'The Comeback Kid' of the media world.
According to eMarketer projections, in 2005, US Internet ad spending will surpass $10 billion for the first time, shooting past that mark to $12.9 billion. That figure more than doubles 2002's bottoming out. Four years from now, companies will spend nearly $10 billion more on Internet ads, reaching $22.3 billion in 2009.
'To call this advertising market 'hot' implies it's a fashion that might turn slack at any moment,' says David Hallerman, Senior Analyst at eMarketer and author of the Ad Spending Trends: The Internet and Other Media report. 'These yearly and quarterly ad spending gains point to a sea change in media usage among marketers, reflecting how the Internet has become an essential element of daily life for more and more individuals.'
"Much of the increase is coming at the expense of other, traditional media channels," says Mr. Hallerman. According to an InsightExpress survey, 74% of media planning and buying executives reported an increased demand for Internet ad inventory in late 2004. That figure was 23 points higher than the next most in-demand medium, cable TV. In contrast, 19% or more of respondents cited decreased demand for media such as newspapers, radio, magazines and network TV.
Mr. Hallerman also notes that despite the rapid growth of online advertising, it hasn't kept pace with audience growth. Overall ad spending rose 32.5% in 2004, while spending per user rose 27.9%.
"Put simply," says Mr. Hallerman, "money has failed to follow eyeballs on the Internet."
Not all is rosy in the online advertising world, though.
"The not-so-hidden secret about Internet advertising — the one that often makes traditional marketers hesitate about allocating more money to follow those eyeballs — is that the creative work is so often poor," says Mr. Hallerman. "When compared to the potentially beguiling motion and sound of a TV commercial, or the rich color and design in a static magazine ad, Internet advertising appears flat."
Get the information, analysis and comparative industry projections you need to make smarter decisions about your advertising budget. Read eMarketer's new Ad Spending Trends: The Internet and Other Media report today."
A new eMarketer report tracks the flow of advertising dollars to the Internet — and how much of that gain is coming from traditional media.
Internet advertising could be dubbed 'The Comeback Kid' of the media world.
According to eMarketer projections, in 2005, US Internet ad spending will surpass $10 billion for the first time, shooting past that mark to $12.9 billion. That figure more than doubles 2002's bottoming out. Four years from now, companies will spend nearly $10 billion more on Internet ads, reaching $22.3 billion in 2009.
'To call this advertising market 'hot' implies it's a fashion that might turn slack at any moment,' says David Hallerman, Senior Analyst at eMarketer and author of the Ad Spending Trends: The Internet and Other Media report. 'These yearly and quarterly ad spending gains point to a sea change in media usage among marketers, reflecting how the Internet has become an essential element of daily life for more and more individuals.'
"Much of the increase is coming at the expense of other, traditional media channels," says Mr. Hallerman. According to an InsightExpress survey, 74% of media planning and buying executives reported an increased demand for Internet ad inventory in late 2004. That figure was 23 points higher than the next most in-demand medium, cable TV. In contrast, 19% or more of respondents cited decreased demand for media such as newspapers, radio, magazines and network TV.
Mr. Hallerman also notes that despite the rapid growth of online advertising, it hasn't kept pace with audience growth. Overall ad spending rose 32.5% in 2004, while spending per user rose 27.9%.
"Put simply," says Mr. Hallerman, "money has failed to follow eyeballs on the Internet."
Not all is rosy in the online advertising world, though.
"The not-so-hidden secret about Internet advertising — the one that often makes traditional marketers hesitate about allocating more money to follow those eyeballs — is that the creative work is so often poor," says Mr. Hallerman. "When compared to the potentially beguiling motion and sound of a TV commercial, or the rich color and design in a static magazine ad, Internet advertising appears flat."
Get the information, analysis and comparative industry projections you need to make smarter decisions about your advertising budget. Read eMarketer's new Ad Spending Trends: The Internet and Other Media report today."
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