New figures from the annual online advertising expenditure report from the Internet Marketing Bureau shows that even though the advertising industry has taken a knock with a decrease of 16.6%, the online Advertising industry is flourishing. Online Ad spends have increased by £82 Million in the first half of 2009, compared with the same time period in 2008. These new figures represent a landmark in the UK online advertising sector and are communicating the opportunities to make a huge impact on revenue and sales online.
The leading cause of this increase in Ad spend is with Search Marketing, better known to industry professionals as Pay Per Click (PPC) and Search Engine Optimisation (SEO) which makes up 59.9% of all online spend.
One area of online marketing which hasn't performed so well was display advertising, which has dropped in spend and overall adoption steadily year on year. Even though the online display advertising has dropped, one part of display advertising has seen a considerable increase, the online video market, which has seen a growth of 195%; this is only set to grow with the new deals being signed with YouTube and organisations to show video advertising on the platform before selected videos. Although this rise in video marketing has been considerable, overall Display marketing has been constantly decreasing, most likely due to the low conversion rates and high spends of the area due to CPM pricing structures, where you are charged per thousand impressions of your ad regardless of whether you obtain clicks and traffic to your site.
The IAB's CEO Guy Phillipson said,
"We've been through an awful recession and advertising has taken a huge hit, so for online to be up by 4.6% is amazing."
Which only reinforces the need for companies to spend more money on their marketing and advertising online where for a small cost you can make a huge increase in your return on investment.
The overall share of online marketing has grown to 23.5%, which puts it ahead of Television advertising which is currently at 21.9% of the market share. This could be due to the considerable high cost of TV advertising in a period where companies are trying to get the maximum return on their marketing strategies and budgets.
Past forecasts were widely predicted that this change was set to happen by 2010, so for it to be happening at least a year before the prediction shows the power and strength of online marketing compared to traditional high cost sectors of advertising and marketing.
With the digital switchover and the increases in adoption rates of digital TV, mass audiences are not as easy to reach with TV advertising as they were before and this is only set to continue in the future with larger adoption rates of fast, high quality broadband, online TV and programming, YouTube, and of course the large influence on purchasing online which is driven by search advertising.
Assistant director of PricewaterhouseCoopers Eva Berg-Winters, who contributed to the report, suggests that online will continue to grow, as the country's economy gets back on track. She said,
"As the overall economy grows, so will online."
So the news for companies wanting to grow their business in the future, Online represents the largest growth in marketing, due to the wealth of opportunities to make a large impact on their clients, sales and return of investment.