Oh Where to Spend Those Ad Dollars
Pity the marketer who has to manage his company's adspend nowadays.
In the good old days, not that long ago, it was easy.
Decisions were made whether to spend the money on print, radio, TV, cinema or outdoor.
Direct marketing was an option as well.
All of these avenues were well established with all the reassuring measurements and feed-back processes in place.
With the stampede of advertising spend heading into cyberspace, the poor marketer is faced with making decisions which are not based on the same scientific and empirical research and results of the more old fashioned marketing avenues available to him.
The marketing science for digital is so new that deciding on where to spend ones dollars is not easy.
So far it seems that paid search, and Google is loving this, takes up about 40% of digital adspend.
The rest is spread amongst classified 17.
5%, display ads 18.
5%, sponsorships, e-mail, rich media and a host of other not as popular options according to Interactive Advertising Bureau/PwC.
These percentages change, depending on the research company, but are still somewhat representative.
As the digital market matures, or at least starts taking baby steps, software is being developed to be able to track anything from responses to e-mail campaigns to click through rates on paid search.
With the increase in budgets available, more and better - read successful - avenues need to be explored.
Enter social networking sites such as MySpace or Facebook and the marketers are drooling.
The buzz amongst marketers is almost deafening.
One can understand this.
With large budgets available, they have to find a place where they can spend it.
What has created the excitement has been the sheer scope of adoption and growth of the networks.
Marketers are rubbing their hands with glee as they visualise their campaigns reaching millions of social networking members gathered in one easy to blast bit of cyberspace.
Hyper-targeting is thrown into the mix.
This would involve identifying the demographics of the target audience and mixing in some behavioral information to hit the social network member with more specific advertising.
MySpace is apparently working on software to enable this and feels it could increase its ad revenue by up to 40%.
Regrettably, it's not going to be that easy.
A problem is the fact that Facebook and MySpace - the two largest of the social network communities - have members who feel that the internet should be free and available to do with as they please.
Ads do not feature in this equation.
If ads are on the page, they have learnt how to visually filter them out or are fairly vocal against having them there in the first place.
Another problem is the fact that the community members are fairly mobile.
This means that at least 50% of signed up members actually move on before making their mark.
Which leads to another buzz word - sticky.
Do members stick around.
Social network sites require effort.
You have to work at it to get some benefit from them.
And once you have collected your 200 odd 'friends' and have poked them, what else is there to do.
Eventually, one would think, the online community will realise that the only way they will be able to obtain free internet access to all the things they want to do, whether play social networking games or read newspapers or magazines is through tolerating advertising.
After all they are putting up with a glut of ads on TV, radio or in newspapers and magazines.
Right now, social networking sites do not present marketers with a cornucopia of opportunity for placing advertising.
This will probably change in the future as more sophisticated ways are devised to tap into this space.
Whether one could predict the value of this market, is difficult to say.
Microsoft seems to think that 5% of Facebook is worth $500m, a fair sum of money.
However, what if this is the peak of the MySpace and Facebook phenomenon and that we will find droves of followers hiking off to find something new to entertain themselves with.
They are playing in the networking communities because there isn't anything better yet.
For creative thinkers, this is an untapped market.
The next billions are there for the taking for the person who can think of something a little more rewarding for people to do than poking each other.
In the good old days, not that long ago, it was easy.
Decisions were made whether to spend the money on print, radio, TV, cinema or outdoor.
Direct marketing was an option as well.
All of these avenues were well established with all the reassuring measurements and feed-back processes in place.
With the stampede of advertising spend heading into cyberspace, the poor marketer is faced with making decisions which are not based on the same scientific and empirical research and results of the more old fashioned marketing avenues available to him.
The marketing science for digital is so new that deciding on where to spend ones dollars is not easy.
So far it seems that paid search, and Google is loving this, takes up about 40% of digital adspend.
The rest is spread amongst classified 17.
5%, display ads 18.
5%, sponsorships, e-mail, rich media and a host of other not as popular options according to Interactive Advertising Bureau/PwC.
These percentages change, depending on the research company, but are still somewhat representative.
As the digital market matures, or at least starts taking baby steps, software is being developed to be able to track anything from responses to e-mail campaigns to click through rates on paid search.
With the increase in budgets available, more and better - read successful - avenues need to be explored.
Enter social networking sites such as MySpace or Facebook and the marketers are drooling.
The buzz amongst marketers is almost deafening.
One can understand this.
With large budgets available, they have to find a place where they can spend it.
What has created the excitement has been the sheer scope of adoption and growth of the networks.
Marketers are rubbing their hands with glee as they visualise their campaigns reaching millions of social networking members gathered in one easy to blast bit of cyberspace.
Hyper-targeting is thrown into the mix.
This would involve identifying the demographics of the target audience and mixing in some behavioral information to hit the social network member with more specific advertising.
MySpace is apparently working on software to enable this and feels it could increase its ad revenue by up to 40%.
Regrettably, it's not going to be that easy.
A problem is the fact that Facebook and MySpace - the two largest of the social network communities - have members who feel that the internet should be free and available to do with as they please.
Ads do not feature in this equation.
If ads are on the page, they have learnt how to visually filter them out or are fairly vocal against having them there in the first place.
Another problem is the fact that the community members are fairly mobile.
This means that at least 50% of signed up members actually move on before making their mark.
Which leads to another buzz word - sticky.
Do members stick around.
Social network sites require effort.
You have to work at it to get some benefit from them.
And once you have collected your 200 odd 'friends' and have poked them, what else is there to do.
Eventually, one would think, the online community will realise that the only way they will be able to obtain free internet access to all the things they want to do, whether play social networking games or read newspapers or magazines is through tolerating advertising.
After all they are putting up with a glut of ads on TV, radio or in newspapers and magazines.
Right now, social networking sites do not present marketers with a cornucopia of opportunity for placing advertising.
This will probably change in the future as more sophisticated ways are devised to tap into this space.
Whether one could predict the value of this market, is difficult to say.
Microsoft seems to think that 5% of Facebook is worth $500m, a fair sum of money.
However, what if this is the peak of the MySpace and Facebook phenomenon and that we will find droves of followers hiking off to find something new to entertain themselves with.
They are playing in the networking communities because there isn't anything better yet.
For creative thinkers, this is an untapped market.
The next billions are there for the taking for the person who can think of something a little more rewarding for people to do than poking each other.
Source...