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Display Ads, Interactive Marketing Killing TV Marketing Spend

display

Perhaps more than any other online platform, display advertising has the ability to deliver one-to-one communication between marketers and consumers.

A fact that has only increased as advertisers continue to experience improved results through innovations designed for them to directly target consumers and deliver relevant, real-time messages.

In recent years display advertising has gone through a sea-change of sorts as improved targeting and measurable results have led to more accurate and actionable campaigns. Overall, the category is expected to grow by 19 percent this year, with online video experiencing an impressive growth of 38 percent, according to DoubleClick for Advertisers.

I suspect there are four key factors responsible for driving this growth:

  • The growth of mobile Internet and online video is creating new environments to reach consumers.
  • Granular targeting (ability to hyper-target based on demographics, geographics, lifestyle, ect.)  reaches consumers efficiently, creating real-time buying opportunities.
  • Rich media is allowing marketers to build more relevant and engaging ads.
  • Increased reporting capabilities allowing for effective measuring of metrics.

How important is display advertising in a marketing mix?

display ad trends

Google is investing significantly to make Google Display Network better for users, marketers and publishers. The company says 99 percent of its top 1,000 clients now run campaigns either on the network or YouTube. And last year, those 99 percent increased spending on display advertising by over 75 percent.

The significantly improved networks are constantly optimizing the odds for conversions.

If all this growth were not enough to convince you advancing innovation is improving the one-to-one communication between marketers and consumers consider this:  Over 66 percent of ads on the DoubleClick’s ad-serving service Ad Exchange are now bought in real-time, according to the company. That means the ability to instantly recognize an individual reader when he/she arrives on a page, or even specific website content, effectively creating the opportunity for a one-on-one dialogue.

And don't neglect mobile in the marketing mix, Google's mobile advertising and monetizing platform AdMob network now receives more than 2 billion ad requests per day, a quantum leap that is quadruple the number of just a year ago.

All these factors should be considered when building out your website, preparing a pay-per-click campaign, developing a social media efforts and even organizing your search engine optimization strategy.

Interactive Marketing Set to Surpass TV Marketing Spend.

interactive marketing spend

According to Forrester Research, U.S. interactive marketing spending will reach $76.6 billion by 2016, and compromise 35 percent of all advertising, pushing online spend past television for first time.

Of  that 35 percent, search and display will continue to be the biggest chunk of the interactive spending, encompassing 44 percent and 36 percent, respectively, in 2016. Mobile paid advertising and search will continue to experience meteoric growth and are expected to surpass email and social this year, according to the report.

All these impressive numbers mean big opportunities for marketers to build out significant and meaningful content that has a high probability of being seen by the right audience.

One way Google is attempting to better deliver these opportunities is through the increased reporting capabilities within its AdWords tool by providing display benchmarks that offer the industry a broad set of metrics to evaluate the performance of online display advertising campaigns.

This week Google introduce a dedicated space for display benchmarks data on the Watch This Space website.

The latest display benchmarks cover a wide range of data from click-through-rate (CTR) metrics to engagement metrics for rich media ads such as interaction and expansion rate, video complete rates and average interaction times across a broad range of ad sizes, creative types and industry verticals.

Some interesting data can be culled from the information provided below from the current benchmark:

  • Marketers' use of rich media ad formats in their ad spends doubled last year, accounting for 18 percent of global impressions from just 9 percent the prior year. In 2010, simple flash ads accounted for 54 percent of all global formats served via the DoubleClick for Advertisers platform, down from 74 percent in 2009. Image ads jumped to 28 percent of formats served in 2010 up from 17 percent in 2009.
  • In the past two years, the overall QTR has remained steady at around 0.09%.

response and engagement rates

  • Interaction rates (times viewed compared to times displayed)  dipped slightly, but in general this measure of engagement remained relatively steady over the course of 2010 after coming down from its peak in early 2009.
  • Expansion rates (opening the ads) have fallen considerably since early 2009 but now we are seeing rates leveling off with a slight uptick towards the end of 2010.
  • Video completion rates (video ads viewed to completion)  on rich media ads have generally remained consistent except for a several month peak towards the later half of 2008.

video completion rate

  • Size matters and larger ad sizes are still generating greater responses. Bigger ads perform better. According to Google's  latest set of metrics half-page ad unit (300x600)  had the highest CTR, interaction rate and expansion rates for  all available creative sizes.
  • Although the U.S. had one of the lowest expansion rates, this market showed the highest expansion time (amount of time viewing ad). The good news: Americans expand ads less but when they do spend more time engaging with the ads themselves.

*The charts cover global benchmark figures for the entirety of 2010 by ad format, ad size and industry vertical. The benchmarks are normalized across hundreds of advertisers, thousands of campaigns, and tens of billions of ad impressions, according to Google's DoubleClick for Advertisers.

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Comments on this post

  1. Awesome article! Your 4 points to keying growth of interactive marketing are spot on. As granular targeting continues to improve we will see fewer wasted ads. They are now being delivered to a very exact audience but soon they will be delivered to only the people who really need/want to see them and that will drive down costs. It’s brilliant.

  2. Granular capabilities are going to be downright scary. I’m waiting for the day when an ad comes and knocks on my door. Thanks for the post.

  3. I can tell you that as far as my real estate business goes…I put all my eggs into the online basket! T.V., Radio, & Print are out in my line of work. Waste of money and trees.

  4. Excellent article. And I agree with Justin above.

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