Sunday, April 22, 2012

Internet Advertising Passes Cable, Now No. 2 Advertising Medium

Financial services second largest online ad category. Are higher gas prices here to stay?

As the NY Times opined late last week, even President Obama can’t reverse the law of supply and demand. But, federal officials can try to ensure that market manipulation and speculation does not drive gas prices higher than is warranted by economic fundamentals.

So, how do you make that pre-election rhetoric into policy? Experts say research presented in Congressional testimony, academic papers, government and private studies shows excessive speculation, mainly by Wall Street index-fund traders, is needlessly driving up prices, with estimates ranging up to $1 a gallon in jacked-up gasoline costs. And Mr. Obama called on Congress to increase regulators’ budgets and powers to police the oil markets and to increase penalties for manipulation. But conservatives, including The Wall Street Journal said no clear evidence of speculation or who the speculators are….and if so, was is natural gas so low. See video interview of Journal assistant editorial page editor James Freeman Pic=Phantom Oil speculation

Our take: While a reasonable amount of hedging and speculation is needed to ensure free-flowing efficient markets, excessive speculation is what causes meltdowns like we saw in the banking and housing markets. In the short run, don’t expect the Administration to take drastic steps before the elections to curb speculation or to interfere with financial markets that have regained most of the ground lost since the 2008. If your business depends on raw materials, transportation, travel or energy, plan for a short period of higher costs which will impact business and consumer demand for your products and services. Also expect higher business travel costs and possible impact of attendance at your live events.

Internet advertising passes cable, now second-largest advertising medium

Internet ad spending grew 22 percent in 2011 to $31.7 billion, according to the latest data from the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers. Researchers said growth is accelerating, not decelerating, from last year’s 14.5 percent growth rate after a recession-induced slide in 2009. The IAB also said mobile advertising was the fastest-growing category in 2011, jumping nearly 150 percent to $1.6 billion in 2010. Mobile also garnered 5 percent of total online ad dollars this year versus 2.5 percent a year ago. Digital video advertising -- which the IAB includes as part of display advertising -- saw strong growth as well, rising 29 percent from $1.4 billion to $1.8 billion. Overall, display spending rose 15 percent in 2011 to $11.1 billion from $9.6 billion.

Financial services second largest online ad category

Financial services accounted for 13 percent ($4.1 billion), behind only retail (22%, $7 billion); telecom, ranked third as 12 percent ($3.9 billion), automotive, 11 percent ($2.9 billion), leisure travel, 8 percent ($2.4 billion), and computing 8 percent ($2.7 billion). IAB said the $31.7 billion in Internet advertising in 2011 exceeded the $31 billion in cable TV advertising last year, making the category second only to broadcast TV ($38.5 billion).

“Pushing past the $30 billion barrier, the interactive advertising industry confirms its central place in media," said IAB President and CEO Randall Rothenberg, in presenting the 2011 figures Wednesday.

Email more popular than social media
Social media may be getting all the buzz, but email is still a more popular mode of Internet communication, according to a new survey from private research firm Ipsos. Of nearly 20,000 adults polled worldwide, 85 percent of them used the Internet for email while 62 percent used it for social networking. Keren Gottfried, research manager at Ipsos, says she expected email use to trump that of social media. “If you think about it, the Internet was first used for sending letters online. It shouldn’t be surprising that we’re using a digital version of sending a letter,” she says. “But the fact that a majority of people are using [the Internet] for social networking is a paradigm shift; there’s no equivalent in the offline world.” Aside from email and social networking, researcher said another key use of the Internet is for Voice-Over-IP. Overall, VOIP is used by 14 percent of people across the globe and trends high in Russia (36%), Turkey (32%) and India (25%). VOIP use is lowest in Brazil (4%), France (5%) and the U.S. (6%).

E-mail most preferred by online consumers
Email is by far the most popular channel among US online consumers for receiving permission-based promotional messages, according to ExactTarget new survey results released last week. 77 percent of respondents chose email, with direct mail (letter, catalogs, postcards, etc. - 9%), text messaging (SMS) on a cell phone (5%), Facebook (4%), and phone (2%) trailing distantly. Email’s is most popular among 35-44-year-olds and 55-64-year-olds (both at 81%), and least popular among 15-17-year-olds (66%).

You owe it to yourself, your clients and your organization to look into every new marketing channel that emerges on the horizon. But please test and evaluate first before rolling out. You need to put your energies into what’s most effective—not necessarily what’s most buzzworthy—but remember what’s working well today may not be your go-to solution a year or even six months from now.


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