Internet advertising is growing in leaps and bounds, largely driven by innovation, but pales in comparison to TV ad spend as illustrated in the chart below.
As innovation continues to produce new products and services geared toward expanding the reach and access of the Internet, more eyeballs are available for advertisers to closely target and measure the success of their ads. A sign-post of this continued growth is the announcement by Nielsen Company that they will be providing new data for media buyers concerning Gross Rating Points (GRP), the formula used by the TV business for decades. It is reported that the online GRP data Nielsen will offer consists of a blend of its demographic panel data with the information gathered by participating online companies, like Facebook. Nielsen has lured Procter & Gamble to test the new data. The data, which will vary from website to website, will consist of anonymous information such as age group, sex and location. This should assist advertisers to better deploy and measure the success of their display advertising, which generally has a large number of impressions, with few clicks. If an advertiser can increase their click-through rate for their display ads, they will continue to allocate more money to this channel based on the information such as GRP.
It will be interesting to see how the balance between ad spend online versus TV shifts as more and more people use the Internet for consuming media.
I keep hearing the comment, “Google is taking over the world”, but is there any truth to this statement? According to the latest data from Hitwise, an online competitive intelligence service, Google is “accounting for 68% of searches in the US and 87% of searches in the UK. Everyone knows Google is the search leader king of the internet. So, why would they say “Google is taking over the world?”
People could be saying this because Google is branching out by offering traditional advertising through the internet. Are you surprised? Google now offers print, radio and TV advertising via their online interface. How? The same way they do search marketing- through a bid auction.
In order to bid for space in a newspaper, an advertiser would select the typical newspaper options (size, color, run dates, section of the paper) and then they would place a bid. The newspaper evaluates your bid and then decides to accept, decline or counteroffer. Once the newspaper accepts the bid, an advertiser can upload their pdf to the Google site and have their ad placed in the paper. Are you curious about radio and TV? I thought so.
Radio and TV also work on the bid auction format, but a little bit different. For radio and TV you select the type of stations, (you can only advertise on certain cable stations for TV), the days you want them to air, the times, the amount you’re willing to pay along with a few other details, and Google will tell you how many impressions you’ll get for the amount you bid. Once you settle on the bid amount, you’ll be on your way to broadcasting your advertisement(s). Does this mean Google is taking over the world?
Not yet. They currently, don’t reach all advertising market areas, but I’m sure that will change in the future. Google is actively branching out in the traditional advertising space and encouraging businesses and marketers to link their search ads with their traditional advertising, which is definitely a plus from a cohesiveness standpoint. Businesses that advertise in the traditional advertising space and on the internet should work with their internet advertising agency to link their online marketing efforts with their offline efforts. In fact, your internet agency could do it all through Google and possibly get you a better rate. Google may not be taking over the world, but they are definitely making themselves a dominating presence in the world of advertising.
You’ve heard the Expression, “Tough times don’t last but tough people do.” Have you ever wondered what the tough business people are doing to prosper during these trying economic times? According to industry research, many businesses are migrating their advertising dollars to the internet. According to E-Marketer- internet spending will increase from $21.1 billion in 2007 to $25.9 billion in 2008. Local businesses are also benefiting from the internet. According to an article by Mike Walsh from Media Post, a new study shows that “Local Internet advertising is expected to increase 50% in 2008 to $13.1 billion as small and medium businesses facing a faltering economy turn to less expensive options for reaching consumers.”
More businesses are looking to use their advertising dollars more wisely, and according to Gordon Borrell, CEO of Borrell Associates, a research and consulting firm that tracks local advertising, “…the Internet, as they’ve tested it over the last several years, is cheaper and seems to work.”
Internet advertising does work and it gives you so many options. Many businesses don’t realize the variety of advertising channels that the internet offers. There are banner ads, pay per click, search engine optimization, online directories, landing pages, and hyperlinks just to name a few. Plus internet advertising can be connected to what you’re doing locally and/or naturally for your business. If your business is advertising a Father’s Day Sale, it can be complemented by a Father’s Day Campaign on the internet.
More and more businesses are seeing the benefit of advertising online during these trying economic times. Be a tough business; instead of cutting your advertising dollars, migrate them to the internet. If you’re not quite sold on using internet advertising alone, then use internet advertising to complement what you’re currently doing in the traditional media space.