Online advertising market
Each year, online advertising sets new records globally with double-digit growth rates. 2009 is no exception as ZenithOptimedia predicts global internet advertising will grow 10 per cent, reaching an outstanding value of $57 billion or 12.6 per cent of the global market. This figure is set to increase further as PwC expects global online ad spend to reach 36 per cent of all advertising by 2013. Phorm is an example of how technological innovation will drive the benefits of creative online advertising and marketing in the future.
Growth rates will exceed all other advertising mediums in 2009 as the accountability, efficiency and flexibility provided by internet advertising continues to increase. Traditional media’s share of the ad market will decrease, with newspapers one of the main victims; ZenithOptimedia predicts that in 2011 newpapers’ share of the advertising market will fall to 22.7 per cent below its 2007 peak.
Online advertising has been built around two key propositions – search and display. Both forms have seen significant growth over the past five years with search dominating the market achieving a global share of 49 per cent. Display, with a share of 33 per cent (eMarketer July 2009) has previously lacked Search’s targeting capabilities and scale.
| Search | Display |
| Text Based, static | Graphical, motion, video |
| Granular targeting, qualified audiences | Limited targeting to date, likelihood that all ads will be targeted in the future |
| Large scale | Large scale, fragmented |
| Ease of use | Requires creative |
| Dynamic bid model | Variety of purchasing methods |
The increase in budgets being spent on online advertising can be partly attributed to marketers being made ever more aware of the increasing popularity of personalised advertising. Research from new media age found the number of consumers interested in relevant advertising has increased to 69 per cent, from 58 per cent a year ago.
The same attitude has been displayed by US internet users who took part in ChoiceStream’s survey in 2008; 41 per cent said they paid more attention to advertising that was personalised and nearly the same proportion of respondents (39%) said they were more willing to click on such personalised ads. Interestingly the more valuable a customer, the more likely they are to click on personalised ads.
As you'd expect from such a dynamic sector, innovation has driven development. Phorm's new personalised internet approach is likely to push online advertising tools, services and networks much further, through systematic industry research on behavioural trends and formats worldwide.
The simple concept behind this approach - which is underpinned by complex technology – is to deliver adverts and content from across the web to users based on their interests. Greater relevance translates into better performance and return on investment for advertisers.
Sources:
- eMarketer July 2009
- PwC June 2009
- ChoiceStream January 2009
- ZenithOptimedia July 2009
- New Media Age July 2009
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