Display Advertising Forecast to Drive Online Spend Growth
Online advertising is forecast to grow by 11% in 2010 and this growth will continue as marketers search for more precise targeting , look to make a more compelling RoI case for their budgets and follow their audiences onto the internet. And display advertising formats – such as banners, rich media and video – will be one of the key drivers of that growth.
Display advertising online is highly appealing to premium and luxury brands. The ability to tightly control the message, the way that message is delivered and the environment in which that message is delivered is attractive to marketers wary of ‘over-democratising’ their brands in less premium environments like social media. And as eMarketer revealed in a recent article, 3 key trends in this channel will allow premium and luxury brands to be more precise in their targeting, and to deliver strong and emotive branded messages in very personal ways.
The first trend that eMarketer identified was that video advertising will grow much faster than other online display formats. It’s forecast to grow 3 times faster than the online advertising sector as a whole and by 2014 will be rivalling banners as the no.1 display advertising format. Why? Because it has the ability to deliver the emotional response of televison advertising but with the additional targeting and measurement possibilities that online provides. And as more consumers ignore standard formats such as banners, marketers will start to look at more instrusive formats such as video.
In addition, eMarketer predicts that channels that are able to target customer based on not only who they are but where they are will come to the fore. Mobiles, of course, will be a key part of this trend as marketers leverage location based search, and the serving of ads and offers within ‘location enabled’ social networks and location-related applications to entice the right sort of customers into their shops and concessions. However, with opportunity comes risk – particularly for premium brands. Delivering messages via such a personal device has the ability to be highly effective if done well, but also highly damaging if done badly. Marketers will have to work hard to ensure that the right customers are not only in the right place but are in the right place for the right reason if their ads are to be effective.
The final eMarketer prediction to note is a likely shift in emphasis away from online advertising as a direct response tool and towards greater use as a branding tool. The advent of rich media and video advertising has made online display advertising the natural vehicle for branding messages. Research has also proven it’s a much more effective use for the medium as it creates prospects at the top of the purchase funnel rather than creating immediate conversions.
The one caveat to this generally rosy outlook for online advertising is the continuing concerns over privacy and the potential for brand damage posed by online advertising. Some of the more effective targeting techniques require data to be gathered on users’ browsing behaviour, albeit anonymously. Fears of a consumer backlash regarding ‘behavioural targeting’ are inhibiting spend on online advertising, which would grow more quickly if these issues could be addressed.
