Opinion: Do agencies really know how to use the internet?
With increasing frequency, I am seeing data which appears to confirm both the return of and the growth in the internet advertising dollar.
Whether this data is in respect of global, regional or more local markets the trend is the same - we are looking at annual growth rates in the last couple of years of about 25 per cent plus and an expectation that such rates will continue for the next few years.
Such growth rates are above those being enjoyed by traditional media but, obviously, from a lower base.
Nevertheless, if these rates continue, then the amount of online advertising spend may threaten the share of the ad pie taken by, for example, magazines, within a five-year period in most markets.
Clearly, this growth has been helped by overall economic growth, which is being facilitated by the widespread roll-out and take-up of broadband.
However, a very significant element of the rebound after the dotcom era was the innovation and success of search engines such as Google to attract advertisers, who placed their ads alongside key words as these are searched.
Having gone from nearly nothing a few years ago, the rate of growth has been stellar but, inevitably, this will slow going forward as the growth will come primarily from rate increase rather than from the volume growth as in the past. So, what will be the next catalyst for growth?
Analysts predict that such growth will come from the use of the internet to create brands using video, music etc as on TV. In fact, there are many that see the two as being complementary, in that TV can raise awareness and then the internet can drive home the details.
My own favourite example is Sex and The City.Carrie Bradshaw is wearing another new creation - check out the Sex and The City website and there will be the outfit with a link to the relevant website of the brand itself and you can even find out the nearest sales outlet.
Increasingly, the trend is away from relatively dull and static banner ads to video ads along the lines of the TVC but, of course, upgraded to work for the internet. Broadband has certainly helped to facilitate longer and more rich video.
The greater use of video is easy to appreciate, but perhaps we should not get carried away, because if you believe those who think that TiVo or other PVR technology is going to give us all the freedom to 'zap' out the ads, then maybe we will take to ignoring those on the internet as well.
Alternatively, it may be argued that the internet will give us the opportunity to choose the ads we are interested in. This gives a clear corresponding benefit to those who are advertising, particularly when there is the potential for the advertiser to track the behaviour of visitors to a particular site using digital cookies.
This and other elements of measurability have always represented clear advantages for the internet as an ad medium and yet again its theoretical power is clear, but we still have to face up to the issue as to whether the industry can take full advantage.
Or whether, as with cable television in the past, there will be a delay in agencies, in particular, understanding the power of the medium to directly address the consumer.
Perhaps it is time for media owners to organise more direct dialogue with the advertiser to ensure that the messages are clearly communicated.
This article was first published on Media Asia
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