New York was the host of the Pontiflex CPL Summit recently and a number of leaders in the web advertising industry were in attendance. Imran Khan with JP Morgan spoke at the summit and is predicting that the web advertising market will see an improvement towards the end of the year.
Khan emphasized that once the economy begins to pick up, the web is likely going to profit greatly. At the moment, television is still one of the greatest pulls for people’s attention in terms of the available media options. Not far behind is the web. Although a number of people take advantage of this useful service, only around 8 per cent of marketing budgets are spent on web advertisements. According to Khan, this presents an incredible amount of opportunity for advertisers to tap into.
What is interesting is that newspapers receive around 20 per cent of marketing budgets which is far more than the web receives. This is odd considering that television and the web both demand far more attention from people than newspapers can even hope to receive.
Khan pointed out that newspapers would likely continue to feel the pain from the loss of advertising budgets in the months to come and that they have not taken into consideration the power of the web at this point. As people quit reading the newspaper and choose to instead read the news online, they will have to adapt in order to compensate for the change in consumer behavior.
Microsoft has just released the latest version of its popular web browser. Those who choose to download Internet Explorer 8 will enjoy several new measures that were designed to protect your privacy while you browse the web. These measures just might have a negative impact on web advertisers which rely on collecting data from web browsers.
If you choose to turn on certain features of Internet Explorer 8 you can stop behavioral web advertisers from tracking your web usage. A number of people have recently expressed concerns about this type of web advertising and some have gone as far as to call for government regulation in the industry. With this new version of Internet Explorer 8, it might be possible to alleviate some of the growing pressure to regulate web advertising.
While many might be excited at the prospect of greater privacy while browsing the web, be prepared for a headache. Finding the privacy features and turning them on is no easy task. Web browsers should keep in mind that Microsoft engages in behavioral advertising as well. This might suggest it is not in the best interest of the software giant to make this an easy task for users.
For those of you that are frustrated by cookies, look out for a feature called InPrivate Browsing. When you activate this handy little feature you will be able to prevent these cookies from being placed onto your computer. These cookies are frequently the keystones of behavioral advertising.
A new company called Pixazza is hoping to change the way in which companies can advertise their products on the web. This new method will also change the way in which consumers purchase these same products. Pixazza is proposing a marketing system that would place shopping tags over various parts of a photograph that might be featured on a website. When the user hovers over one of these tags, a popup will provide a number of products that are similar to what is featured in the photograph. From there, the user will be able to purchase the product by clicking a link.
To help Pixazza, Google, along with a number of other sources, is providing funding. The service is said to function in a similar way to Google’s AdSense although it uses graphics instead of text. Advertisers will be able to utilize the Pixazza service which will focus on industries like home furnishings, electronics, and apparel.
At the moment, only around 20 people are actually employed by Pixazza although the company is hoping to take advantage of what is called ‘crowdsourcing’. This simply means that Pixazza is hoping to recruit a large number of people that will contribute fractional amounts of labor. This includes adding tags to photographs and even finding appropriate products that match the tags. People that take part in this crowdsourcing initiative will slowly work their way through the ranks which will earn them additional capabilities.
There are many sites that have added the functionality of Meebo so that their users can take advantage of the chat service. This is great for sites like Flixster because their users are not forced to navigate away from the site if they want to chat online with another person. It now appears that Meebo will be adding some web advertisements to the handy interface by the end of the month.
Users who take advantage of the chat feature will notice the appearance of banner advertisements. Once they click on the banner, a larger advertisement will appear on the screen which measures around 900 x 400 pixels in size. At the moment, the concept appears to be a good idea on behalf of Meebo although there is no clear indication as to the amount of money that the advertisements could bring in.
For those that choose to use Meebo’s chat service directly from their site, the banner advertisements may look a bit familiar. The company first implemented them there and after a successful experience they will be pushing the advertising service further.
Many people seem pleased with the advertising capabilities that Meebo is providing. Because a larger box appears when you click on the banner, there is more flexibility as to what advertisers can do with it. This means you could play a game in one of these boxes or watch a trailer for a new movie that is coming out. At the moment, advertisements on Meebo’s sites have about one percent of users clicking on the banners.
Local web advertising has proven to be a valuable market over that last few years. Their target was primarily larger businesses that helped this market grow at lightning fast speeds. That is until the recession began to set in and marketing budgets started to tighten. This has left many web advertisers looking for a new target market to tap into. The answer for many of these local web advertisers seems to lie with smaller businesses.
In the past, small and medium sized businesses proved to be wary of using the Internet for advertising. In many cases web advertising can prove to be a less expensive alternative to other forms of advertising such as print. As a result, many smaller businesses are now hurrying to advertise on the web.
Last year, these smaller companies spent nearly $7 billion on web advertising. It has been suggested that tapping into this lucrative market might not prove to be so easy. Gordon Borrell with Borrell Associates said “The point is that for everybody’s desire to get to those SMBs because they appear to be a pot of gold, it is a heck of a lot more complicated than that. It will require thought and stamina to corral them in a way that will provide sustainable income for a media company.”
One of the major issues with smaller businesses is that they typically spend a lot less on an individual basis when compared with much larger businesses. This presents a problem for web advertisers, as the amount of work that they must do is comparable between the two groups.
It would appear that the effects of the recession are causing some consolidation in the mobile advertising industry. One of the latest examples of this can be found in the buyout of mSnap by SmartReply. The latter company creates custom marketing campaigns for clients that can be used over the telephone and through email.
There are many companies around today whose focus lies specifically on the mobile Internet. A company like mSnap was created not only to improve the way in which mobile web browsers are able to view sites, but also to focus on methods by which to send advertisements via text message. Over the last couple of years, several companies just like mSnap have popped up all over the place. It is thought that these companies have been able to raise more than $1 billion worth of venture capital.
Although it was assumed that companies would shift their advertising budgets to the mobile Internet, it appears that this has not happened as fast as planned. This means that companies like mSnap are put into a situation where they either need to cut costs by reducing staff or to consolidate with another company.
mSnap joining together with SmartReply is a great solution for both companies. SmartReply has been looking for a way to break into the mobile Internet market and with the help of mSnap they will have a great start. Mobile advertising is expected to bring in around $760 million this year alone.
It is hardly a surprise anymore when another newspaper announces that they will no longer exist in print format. Instead these newspapers are heading online and not a whole lot of people seem to be upset about it. One of the biggest reasons for the new trend is related to advertising
Over the last three years, the amount of money spent on advertisements that are displayed in print publications has dropped significantly. Back in 2005, the industry reported earnings of close to $50 billion for print advertisements. Today, that figure has fallen to around $28.4 billion.
Companies are struggling to deal with the ultimate effects of the decline in print advertisements. While some newspapers may head online, other companies like the New York Times are being forced to cut jobs in an effort to save money. In worst-case scenarios, some companies including Tribune Co. have had no choice but to file for bankruptcy.
It is thought that a number of companies failed to take web advertising seriously. Nobody even thought to figure out how much money was being generated by online advertisements until around 2003. By 2007, it had already been determined that around 7.5% of advertising revenue came from the web.
Now several of these newspaper publications are making themselves comfortable online. The problem is that economies across the globe are in decline so their fight to regain some ground will likely be that much harder for them.
Many smaller companies find it difficult to determine what makes the most sense in terms of advertising. As these companies all have a limited marketing budget, it is important that the money is spent in the best possible way to promote the company. A new report indicates that many smaller companies are spending their marketing budget on alternatives to web advertising. This could mean that a company invests some of their budget into improving their web presence overall.
The report, which is named ‘Main Street Goes Interactive’, was generated by Borrell Associates. If its forecasts are accurate, five years from now spending on marketing that is not related to online advertising will reach over $1.6 billion. The report also suggested that some web advertising sectors will see much slower growth than they have in the past.
According to the report, “The blurring borders between what is advertising in the interactive world and what is not added to the shift of ‘non-ad’ marketing dollars. Businesses large and smaller–but especially smaller ones–don’t even try to make the distinction. To them, whatever they spend or do on the Web is advertising, whether it goes through an intermediary or not.”
The forms of online advertising that are popular today, such as the paid search advertisement, are expected to remain popular in the near future. There has been some speculation that banner ads may fall in popularity to more interactive forms of advertising like video.
