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Market |
Information Technology |
Report Type |
Market Research |
Country |
Global |
Published |
12 May 2009 |
Number of Pages |
0 |
- |
|
Publisher |
BuddeComm |
Spending on advertising using digital media channels now makes up more than 10% of overall worldwide advertising spending. While the economic downturn is impacting upon advertising spending in 2009, the various advertising channels are being affected differently. There are two key elements which may absorb some of the negative impact however, particularly for digital marketers. Firstly advertisers are migrating from traditional media to new media as the web audience grows, potentially at the expense of the traditional media audience. Secondly the digital platform will enable digital advertisers to employ targeted advertising based on a user’s specific profile. This promises to increase the effectiveness of advertising and as such should enable digital marketers in the future to charge a significant premium relative to traditional advertising forms.
Internet advertising is by far the most prominent digital media platform for advertising, although mobile advertising is beginning to gain traction, driven by advances in multimedia handsets and the increasing use of, and lower costs associated with, mobile data services. Internet advertising linked to keyword searches is the most popular form of online advertising, followed by display ads. This places leading Internet media companies such as Google and Yahoo at an advantage. Google in particular is well positioned; it is the most popular search engine worldwide and its revenue from online advertising is growing both in the US and internationally.
The traditional media companies have made quantum leaps compared with the telcos in terms of advertising and marketing in the digital media era. While the Internet companies like Google have clearly been the leaders to date, media companies are also making great progress, launching events using their traditional media and supplementing them through new media activities. Despite this, the traditional media companies have a new challenge to face as the economic downturn impacts upon advertising spend.
The shift to online news continues to the detriment of print newspaper publishing, and the slowdown in advertising spend is adding further pressure on an already struggling industry. While the business models for online news do not yet stack up, there are many publishers now attempting to increase revenues from online platforms. A recent initiative in the US sees publishers working together to create a model that will include online subscription charges, potentially providing a revenue source beyond advertising.
Marketers must also overcome obstacles such as the vast differences in market sophistication around the world, the current dependence on regional, rather than global media buying habits and an industry-wide reluctance to move from offline pricing models. Marketers will also need to think of better ways to integrate advertising campaigns across different kinds of advertising ‘platforms.’
Mass media forced advertising to take on a form that was irritating to customers, whereas the new media allows the advertisers to be far more engaging with those people for whom a particular advertisement makes sense. People realise that they have a choice – either pay for entertainment or accept advertising – and surveys indicate that people are not averse to information and advertising that is relevant to them. The new media allows people to indicate what they are interested in and advertisers then have an opportunity to communicate with these customers. Niche media will be a win-win for everybody.
This report provides valuable insight into the developments taking place in the marketing and advertising sector in terms of digital media. It includes information on both online and mobile advertising including statistics and analyses. The report explores the impact that digital media has had on the traditional media and the changes they are making to evolve in the new landscape. Information on the leaders to date, the Internet media companies, is also included along with a case study on Google. The report also explores the issues surrounding open networks and net neutrality, as these are important to the continuing success and innovation of online services. Regional information on developments in North America, Latin America, Europe, Middle East, Africa and Asia Pacific are also provided.
• Overall global advertising spend is expected to decline by at least 4-6% in 2009.
• With a slow down in advertising spend in the wake of the financial crisis, print newspaper publishers, which rely heavily on classified advertising, are now also facing further pressure beyond the shift to online news. This added pressure has led to the demise of some publishers around the world and also to a significant change in business models.
• A key long-term goal for participants in the mobile advertising market relates to mobile payments. Telecommunications providers aspire to not only provide the viewer and serve an advertisement but to enable the user to complete a purchasing transaction too. Despite the business models for mobile advertising still being trialled and developed, mobile advertising spend is also expected to flourish in the future.
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