Advertisers ‘plan to increase online spend despite recession’
- Added:
- Apr 23, 2009
Despite the credit crunch, the internet is continuing to prove the medium of choice for more advertisers as they seek to maximise return on investment, according to a new study.
Research from trade body the European Interactive Advertising Association (EIAA) found that 70% of advertisers claim that their allocated online ad spend is increasing in 2009.
The growth is set to continue, up 21% in 2010 and a further 15% in 2011, according to the research.
The EIAA Marketers’ Internet Ad Barometer, was commissioned by the EIAA to provide the most up to date insight into how advertisers plan to change their strategies in 2009 and beyond.
The research explores economic and commercial issues for marketers today and how they will evolve their use of interactive media to target their audiences.
The results reveal that online is playing an increasingly important role in overall advertising strategies with 47% of advertisers now regarding online as an essential factor within the marketing mix (vs. 38% in 2008 and 17% in 2006).
Budgets move from Traditional Media
Marketers continue to reallocate budget from traditional media to online, demonstrating the continued investment by marketers in the digital sector.
The research indicates that the increase in online ad spend is coming directly from TV (37% of advertisers claim increase in online ad spend has come from TV) newspapers (32%) and increasingly, magazines (46%).
This growth in digital demonstrates not only the accountability of the medium but also to the increasing value and time consumers are spending online (+28%† growth in weekly internet use in 2008 compared with 2004).
Interestingly, direct marketing and radio budgets have seen the biggest decrease in revenue reallocated to online spend, with only 24% and 12% of advertisers claiming increase in online ad spend has come from these media (compared to 2008 – 32% and 20%).
This points to a possible focus shift towards media that attributes itself to performance-led targeting as advertisers look to maximise their ROI, reach and cost efficiencies. Further to this, 72% of advertisers cite an increase in targeting according to demographic breaks usually associated with traditional media.
With over half actively targeting the 25 to 44 age group (28% 25-34, 29% 35-44) it seems that advertisers are matching their targeting capabilities with the demographics that are using online frequently (average of 13.9 hours† spent online each week for 25-34 year olds and 11 hours† amongst 35-44 year olds).
Emerging Formats
Advertisers are increasingly recognising the value and impact of mobile advertising.
The research found that advertisers who see online advertising as essential are increasing their mobile budgets significantly, (25% vs. 14% of all advertisers) showing that advertisers that have a heavy association with online and understand its benefits, are also at the forefront of emerging formats and innovation.
With almost a third of all advertisers (30%) stating they use mobile within their advertising strategy and mass market user penetration of 87%† across Europe the mobile advertising format is clearly set to become an increasingly effective platform.
The research also points to a move towards further investment and growth in particular formats such as online video advertising, with 35% of advertisers stating this format is increasingly being used within their online strategies.
With the growth of rich media content and brands such as Barclays using interactive video content to add value to its current television campaign, it seems that video set to grow and develop in coming years.
Pan-Regional Online Ad Budgets
According to the research, advertisers are currently allocating an average of 16% of their online ad spend at a pan-regional‡ rather than country level (vs. 11% in 2008).
On average pan-regional advertisers also predict a higher increase in their online advertising spend in 2009 with 82% citing an increase compared with 69% of their local counterparts.
Western Europe is currently the most attractive market for online multi-national deals due to perceived cultural and marketing similarities and with this group using behavioural targeting more heavily compared to local (39% vs. 22%) it seems that advertisers are taking further steps to increase cost efficiencies yet continue to maximise the potential of their target market.
Alison Fennah, Executive Director of the EIAA said: “With every media investment closely scrutinised by brands and a renewed focus on ROI, online comes into its own as the most effective way of providing accountability for marketers.
“Market conditions are tough, yet online is continuing to innovate and emerging formats such as mobile advertising and online video advertising look set to become big players in the next few years as brands see the benefit of cross-platform marketing campaigns.”
EIAA Marketers’ Internet Ad Barometer 2009 Methodology
The survey was conducted online with senior marketing executives with responsibility for advertising budgets and/or strategy across UK, France, Germany, Italy, Spain, Netherlands, Belgium, Norway, Sweden and the pan-European sector.
The following sectors were included: FMCG, Entertainment, Automotive, Travel, Consumer Electronics, Telecoms, Finance and Retail
Source: www.eiaa.net
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