The latest quarterly figures on Internet advertising in Australia have just been released by IAB Australia and they show that the market has recorded continued growth during the tough economic period. The total spend for the latest quarterly period, ending 30th September, reached $466 million, the highest total recorded to date.

The new Online Advertising Expenditure Report (OAER) has been compiled for the IAB by PricewaterhouseCoopers (PwC) as usual, using available data or estimates of advertising spend in the period covered. Although the latest quarterly figures have reached new highs, the year-on-year growth against the same period in 2008 was only up by 3%.

The Search and Directories sector, which is dominated by Google AdWords, is continuing to show healthy growth, despite actual figures from Google being unavailable, so the trend is largely based on market estimates. In total, this sector accounted for 51% of the total online advertising market in Q3 of 2009, and an increase of 12% on the same period a year ago. General Display accounted for 26% of the market and Classifieds 23%, although both of these sectors showed a decline in value compared to the same period a year ago, down 3.8% and 5% respectively.

For the first time, the latest report also captured the online advertising expenditure within the General Display category for the specific media of video, email, CPM (cost per thousand, often referred to as ‘brand’) as well as direct response (often referred to as ‘performance’) advertising. Online video advertising which represented 4% of the General Display category, is on par with figures seen in the US and UK, and is expected to increase sharply in future quarters. Email advertising was 6.5% of General Display whilst CPM advertising (mostly banner advertising) made up 75% of the category, with only 22% reported for response and 3% for a hybrid classification that combines these two forms of advertising.

Overall the online advertising industry is continuing to show healthy growth compared to recent declines of other advertising markets in Australia, so that the online share of the total market of the $13 billion Australian advertising industry continues to grow. However, this continued growth, although slowing against the previous year, continues to come from search advertising sector and particularly Google AdWords in Australia, as more and more companies enter this market to promote their businesses through targeted search marketing.

A spokesman for IAB Australia said that "With continued industry developments in online audience measurement, research demonstrating the effectiveness of online advertising in influencing consumers' purchasing decisions and behaviours, and maturing self-regulatory standards and best practice guidelines, online is now a trusted, core and essential component of effective marketing communications."

Labels: online advertising, research

MediaWeek reports on new research from Dynamic Logic that claims to show that the most effective display ads on the web are those that are integrated within a web page's content, rather than larger, dominating adverts, in terms of driving traditional brand metrics such as awareness and purchase intent.

Dynamic Logic analysed 2,390 display campaigns over 3 years and found that half banners (234 x 60 units) and rectangles (180 x 150 units) proved to be more effective than larger, pricier placements such as leaderboards and skyscrapers. However, these findings conflict with the current trend among web publishers and advertisers, who are pushing toward larger, more interruptive online advertising as a way to funnel brand dollars away from TV.

The survey also found that creative quality and level of sophistication are also key, so that among the 2,000-plus campaigns analyzed, rich media ads that featured video excelled in most branding categories, including awareness, brand favourability and purchase intent. Meanwhile, more basic Flash ads - seen as the most common form of display advertising - consistently achieved the lowest scores.

Labels: online advertising, research

New research published in the US and reported by MediaPost indicates that business-to-business (B2B) media is seeing a rapid shift of advertising revenue from the traditional print channels to online platforms. The research was conducted by Outsell Inc. also shows that overall B2B revenues have decreased since 2005.

The findings show that the print share of total B2B revenue fell from 58.3% to 40% between 2003 and 2008, as online revenues jumped from 18% to 33.9%. The remaining share came from events, which stayed around a quarter of total revenues. The main period of change happened between 2005 and 2007, when print revenue declined from 53.1% to 44.1%, while online increased from 22.1% to 30.2%.

The report says that a good part of the percentage shift from print to online simply reflects diminishing print revenues and although there is a changing pattern, there is no question that the future of B2B media lies online. Infact the article says that "B2B has been confronted with the same dilemma faced by other print media, including consumer magazines and newspapers -- online, while a promising area for new revenue growth in its own right, has so far failed to offset much larger losses on the print side".

Labels: internet business, online advertising

An online survey conducted by AdWeek with users of the social networking site LinkedIn assessed how the current economic situation may impact the role of online marketing. Over 4,300 respondents too part in the survey at the end of March and when asked "How will the economic downturn most affect advertising?", 22% said 'there will be less advertising'. Another 8% said 'advertisers will play it safe' but the majority responded to say that the main effect would be a form of evolution that makes advertising more adaptive to changing conditions.

Within this group, 30% of respondents considered that the economy would lead to "better targeted ads to improve ROI," 23% anticipated that the "shift to online would accelerate" and 15% think "ads will follow traffic to social media." When the responses are broken down by job function, there was a notable gap between people in "marketing" and those in "sales": with the latter being much more likely than the former to choose "better targeted ads to improve ROI" (36% vs. 23%) as the recession's pre-eminent effect on advertising.

A full report on the survey and the breakdown of the results by different categories can be seen on LinkedIn (requires user login).

Labels: online advertising, research

Media Post comments on a new report from the the US by Borrell Associate that forecasts a tripling of spend by small and medium-sized businesses over the next 5 years due to local companies pouring more money into developing their websites and other online promotional activity.

The report says that whereas interactive ad spending across segments such as display, search and email will slow their pace of growth (by only 10% in the next five years to $7.5 billion), the level of non-ad spending on things like websites or online promotions and public relations will increase from 7.9% to 18.1% of interactive marketing budgets from 2008 to 2013.

On the advertising side, Borrell estimates that paid search will continue to be a key part of SMB spending while banner ads will give way to video. Meanwhile, standard format advertising, which currently accounts for 47% of all SMB interactive spending, will make up less than 19% by the end of 2013.

Labels: online advertising, research

The New York Times covers the trial that Yahoo! is currently running with a new form of PPC advert, which integrates images and video. This is something Google already offers, but only for selected advertising with their third-party content network, whereas Yahoo!'s new test is targeting their main PPC channel on the Yahoo! search network.

Called Rich Ads in Search, Yahoo! is hoping that the higher profile and better clickthrough rates shown from the initial tests will attract more advertisers to use this format of advertising, and will also drive more clicks and therefore revenue from their search results.

Although Yahoo!’s traditional strength has been in display advertising, as the current economic recession has deepened in the US, many advertisers have shifted money to search, which gives them direct, measurable results. Yahoo!’s recent fourth-quarter results have reflected this trend, with search revenue showing an 11% growth and display revenue falling by 2%.

The article reports that Yahoo! has been testing these new adverts in a number of formats, with dog-food company Pedigree displaying a small video for a commercial when a user searches for the company name. The video opens up into a larger format and plays once clicked. Similarly, a search for Staples displays in a similar light-blue box with the company’s logo on the side, which is also a link to the corporate site. Alternatively, retailers can include a search box within the advert panel to enable searchers to enter a ZIP code, which will then take them to the advertiser’s website that lists the nearest stores or branches nearby.

Yahoo! is currently charging a monthly fee for the service, compared to the traditional auction-based pricing of search advertising. It is reportedly only allowing only a selected number of large, brand-focused advertisers to test the program. According to Yahoo!, some advertisers in the pilot program saw an improvement by as much as 25% in click-through rates, although an independent agency reported lower results, around 5-10% higher than the regular text adverts.

Yahoo! clearly hopes that this new type of search advertising will prove attractive to companies who pay high prices to develop their commercials and logos and want to be able to show those wherever they can. It may prove an important development for Yahoo!'s search performance as the company remains under pressure from financial analysts to consider selling its search business to Microsoft, who continue to express an interest in such a deal to grow their share of the search market.

Labels: online advertising, ppc, yahoo

The MediaPost blog reports on some new research of more than 3,000 marketing executives in the US which asked them about their online advertising priorities for 2009. Just over 80% selected e-mail as a strong advertising performer, compared to 57% who chose search as the second leading performer. Amongst the other categories, 42% chose online display advertising as a strong performer, 23% selected social media and 9% chose mobile marketing.

In terms of advertising budgets for 2009, 58% expected to increase their spend on email marketing campaigns and 54% said the same for search marketing. 44% claimed to be targeting more spend in social media, whereas 35% would be cutting back on offline media and 22% would be reducing their spend on display advertising on the web.

Labels: online advertising, research

A report by Media Post covers some recent research in the US which indicates that 39% of consumers  are more likely to click on a web advert if it is personalised, while that number rises to 58% among those who shop online at least several times a month. The survey also says that the bigger the spender, the greater the interest in personalised ads, indicating that more regular and familiar online shoppers respond better to this form of advertising.

The results of the survey, conducted by ChoiceStream, showed that 70% of consumers admit that their purchase decisions are at least sometimes influenced by having seen an advert for an item, as other recent surveys have also suggested, and a smaller percentage of consumers admit that they are influenced by brand advertising as well, with 39% admitting that they are more likely to buy from companies that they have seen advertised elsewhere.

In terms of the personalisation aspect, 60% of shoppers surveyed were aware that retailers use information about their online shopping behaviour to target advertising to them, and 78% of consumers are interested in receiving personalized content.

More results from the research can be found in the article, plus a link to download the full survey in PDF format.

Labels: online advertising, research