Being caught up in the daily frenzy of activity that is the Internet, where a year is a generation, it’s easy for me to forget that less than ten years ago there was no Internet advertising industry at all, and that less than five years ago the notion of advertising on blogs (what the hell are those?) was absurd (Blogads started about 3 1/2 years ago, the same time we did).
So until I stopped and thought about it for a moment, I thought the below report figures sounded low: but the Internet is competing with ad venues that are no less than 60 years old (television, the rest are older – newspapers have been around for hundreds of years), so the figure of 5% of the total ad market in ’04, and a projected 10% of the total ad market by 2010 are actually quite remarkable.
According to “The Changing Face of Advertising in the Digital Age,” a new report from market research firm Parks Associates, spending on Internet advertising will account for 10% of total U.S. ad dollars in 2010, doubling from 5% in 2004 at a compound annual growth rate of 14%.
The report also finds that almost 21% of Internet users consider Internet advertising as the most relevant ad format for them, outscoring more traditional media formats such as newspapers, magazines, and radio.
“In the next few years, the Internet will become a mainstream ad platform and attract top dollars from advertisers,” said Harry Wang, research analyst at Parks Associates. “Because the Internet is an interactive and versatile platform and offers rich consumer usage data, advertisers can improve their ad targetability and achieve better results.”
Such benefits are extremely important to advertisers, who have been plagued by audience and media fragmentation and a lack of in-depth media consumption data from traditional ad formats. Many large companies with familiar brands, including Anheuser-Busch, Procter & Gamble, Verizon, and Wachovia, have been moving money out of network TV and to the web, demonstrating advertisers’ growing confidence in Internet advertising.
“Traditional media companies are fully aware of this ongoing change in the advertising industry,” Wang said. “The Internet has altered the standard for the entire ad world, and traditional media have to respond by making their media platforms more interactive and results-oriented.”
Yeah, but pop-ups still suck.