I couldn’t help but notice that recently, all the signs around me point to online being the big hitter in 2007.
For one, multiple news articles that I’ve been reading are all reporting that there will be a significant growth spurt in online advertising, if the (forecasted) growth rates from recently released GroupM, ZenithOptimedia and Universal McCann studies are anything to go by.
When I hopped over the have a read of TK’s blog, The Pitch HK, there it was again (If these guys are convinced then you’d better be).
Even the emails I’ve been receiving from PR people pitching stories all tout the strength, and importance, of online advertising.
But is it any wonder that online advertising is going to be the next big thing? For a long time now we’ve been reading that companies have been gradually shifting ad budgets online. Much of this I guess, stems from the fact that that’s the ‘place’ where advertisers can reach that most lucrative of demographics, the youth. A Synovate study found young Asians between the age of 15 to 24 are a digital generation plugged into new media, and more financially savvy than ever before. The youth are the future, it’s been commonly said. Well, youth also quite literally drive the future of a brand. Witness Sony Ericsson, Samsung and StarHub’s attempt to engage with youths. A mobile industry insider told me that even though it’s true youths don’t have earning power now, they are the high power earning adults of the future. Quite simply, if they can hook teenagers/youth today, there’s a high chance those same youths will follow the brand as they age into adulthood, thereby assuring the brand’s longevity.
Just some stats to consider:
Brand Republic states a GroupM report that shows online advertising activity is set to grow by 27% this year and 28% in 2007. This corresponds to a ZenithOptimedia report which forecasts that online activity will increase its share from 5.8% during 2006 to 8.6% in 2009, “when it will for the first time outstrip radio advertising globally”.
MediaPost Publications reports online advertising opportunities is keeping the rate of ad expansion in check, according to the results of the GroupM study, which said “one thing stopping this (the increase in media growth) is the growth of the internet in developed economies. Its audience is growing even faster than its incoming tide of advertiser money, so it is actually getting cheaper. At the same time it is attracting cash from the big but fragmenting and hence inherently inflationary media, whose valuable reach is in shortening supply." MediaPost writes that the report also indicates TV remains the “number one growth driver for the global advertising marketplace, but the internet has become the second biggest contributor”, with the internet accounting for 21% of the world's ad spend increases in 2006 as opposed to 52% for TV.
If you’re a marketer, are you ready to bring your product to the online market/if you have already, is it working out for you and will you shift more of your budget online; and if you’re an agency, are you ready to catch the wave?