Advertising Moves to the Internet
Ogilvy famously said of television ads; "50% of advertising works, we just don't know which 50%". Not the case with online advertising! Today, marketers can readily measure the results of Internet advertising versus guessing with traditional media. This results in efficient advertising, targeting and higher ROI. Whether you are a small town business or a multimillion dollar corporation in New York City, chances are that your closest competitors and you have established websites and have used some form of online advertising to market business and services.
Businesses are shifting gears and operating at a faster pace today. Although the choice of an advertising medium is based on various factors, there are few companies who have not chosen the online way to advertise. The importance of advertising a product or service to spread the awareness of its availability or existence is widely recognized. With the growing number of Internet users, advertising online is only bound to grow exponentially. The change has been tremendous, whether it is the mindset of consumers or the change in marketing medium. According to the emarketer report on US Advertising Spending, the Internet’s share of total media ad spending is rising by at least 1 percentage point every year. The main reason for this is marketers choosing to spend more on Internet ads, and less on ads in traditional print media.
Today, online advertising is a multibillion dollar business. It has the power to connect businesses and people like never before. For consumers who seek flexibility to research and buy online, online ads are a respite. In fact, 91% of Canadian internet users say that they go online for product information. In Canada, Yellowpages.ca is the most preferred online directory. As an advertiser, you can display your product to more than 9 million unique visitors who look for best product information through the Yellow pages group network of websites. You would be hard pressed to get that many visitors to your YellowBook print ad.
Why is online advertising turning into a cost-effective means to advertise? Primarily, this growth is being driven by the rising number of internet users, raising awareness and growing broadband availability and eCommerce, are all playing a key role in the growth and popularity of online advertisements. Target marketing, message tailoring, flexible rates, creativity, exposure, speed, and measurable ROI are the top reasons for the growth and popularity of the online advertising medium. Online advertising has provided small firms with an opportunity to reach global markets on the web with a clear and effective online ad - they can even beat multinational conglomerates who have invested billions of dollars on print and television ads. With online advertising, you can use Pay per Click, directory listings, and search engine optimization, to target consumers.
Erosion of Newspaper Classifieds Audiences
The online version of classified ads has revolutionized media advertising and has seen massive growth in the past couple years. Hitwise recorded 84% increase in traffic to classified ad websites in the US, this year. The strong adoption of online Classifieds sites such as Craigslist, has led to a scenario in which classifieds revenue for newspapers will most likely never return to previous levels. In fact newspapers have taken the greatest hit in classified advertising revenue due to competition from online classifieds sites, including Craigslist, eBay etc. While Craigslist’s (which offers free listings in most cities) annual revenue is pegged at a modest $100 million, it is estimated that classifieds revenue for print newspapers has declined from a peak of $20 billion in 2000 to approximately $10 million this year. Those newspapers that are struggling to stay afloat – as several have closed their doors - are electing significant layoffs to compensate for revenue and circulation loss.
You can find a comparison of the size and growth of the Craigslist audience to the size and growth of the Newspapers category.
|Visitation to Newspapers and Classified Categories
August 2009 vs. August 2008
Total U.S. – Persons 2+
Source: comScore Media Metrix
|Total Unique Visitors (000)|
According to the IAB website, search and display-related advertising continue to represent the largest percentages of overall interactive advertising spend. Search revenues amounted to more than $5.1 billion for the first six months of 2009, up from that same period in 2008.