Online Ads To Outpace Other Categories
Online advertising will continue to outpace overall ad spending, growing 14 percent next year to $51.9 billion, according to a new Borrell Associates forecast released today.
In contrast, the overall ad market is expected to increase less than 5 percent to $238.6 billion.
The fastest-growing segment of interactive advertising will be local online, anything targeted and everything involving social media. In 2011, local online is forecast to grow nearly 18 percent from $13.7 billion to $16.1 billion.
Both national and local advertisers are expected to tap targeted display, driving the segment up 60 percent to $10.9 billion. While national advertisers are expected to increase their use of targeted display by nearly 50 percent, local advertisers will double their use of local display, reaching more than $2.3 billion next year.
In stark contrast to targeted display, run-of-site display will decrease, dropping 14 percent next year to $8.2 billion for both national and local online.
Also on the decline will be national paid search, dropping 11.3 percent.
Read More: AdWeek
Why The “Black Box” Ad Network Is Going The Way of 0% Home Financing And Enron Accounting
The days where ad networks glamorized themselves as a black box of information which held deep dark “proprietary” data knowledge and secrets is officially over. We all remember how five and ten years ago we heard outrageous claims of “a billion points of data per month”, and “we harness data from over one million domain-level URLs” in boasting about the breadth and volume of intelligence a network had. Of course, no one could prove anything, and the networks who made the most outrageous claims were the most opaque. But there is no longer a need for any opacity. Full transparency is now coming around, so expect to see some previously-made claims debunked, and some technologies that were previously overlooked becoming more valued. Here’s how you can employ new transparency tools, and avoid being swooned by grandiose claims.
Read More: GoodwayBlog.com
Armstrong: Mission Is To Make A Sick Company Healthy
AOL (NYSE: AOL) CEO Tim Armstrong knew he would have to do a lot of investor soothing given that it posted another tough earnings report for Q2. He described the mission before him as very simple: making a sick company a healthy one. Invoking Warren Buffett’s “snowball” metaphor for the growth of his portfolio depending on finding a wet snowball and a steep hill to roll it down. “We’ve got a tightly packed snowball” at AOL, Armstrong said. He also described a “platform war” currently going on in Silicon Valley and how “content is the ammunition” and AOL will be a central supplier of that firepower. In explaining the dismal ad prospects, despite the recovery, Armstrong said advertisers continue to lag consumers in adopting online media. Video is going to be a focus for AOL and Armstrong noted that there will be some branded entertainment partnerships announced shortly. StudioNow, which it bought last winter, grew 25 percent in terms of video output from the last quarter. “You will see a new home page that is targeted heavily around video this quarter,” Armstrong said. On the local front, AOL’s hyperlocal play Patch added 39 new towns for a total of 83 localities in its network. “Nobody likes to show up to these calls and report down numbers,” but Armstrong wanted investors to known that he has his own money tied up in AOL as well and asked for continued patience as he attempts to turn it around. Meanwhile, Q3’s results is looking “choppy.” In terms of products he is happy about, Armstrong again focused on the homepage—which attracts about 15 million uniques—and Patch and Mapquest.
Read More: PaidContent.org
Google CEO Schmidt: “People Aren’t Ready for the Technology Revolution”
Eric Schmidt spoke at the Techonomy conference in Lake Tahoe today and dropped some serious rhetorical bombs. “There was 5 exabytes of information created between the dawn of civilization through 2003,” Schmidt said, “but that much information is now created every 2 days, and the pace is increasing…People aren’t ready for the technology revolution that’s going to happen to them.” The Techonomy conference is a gathering of people from around the globe seeking to use technology to solve the world’s big problems. Schmidt spoke there today and said that people need to get ready for major technology disruption, fast. The bulk of what’s contributing to this explosion of data, Schmidt says, is user generated content. From that content, far more prediction than we’ve seen today is possible and will be a factor in the future. “If I look at enough of your messaging and your location, and use Artificial Intelligence,” Schmidt said, “we can predict where you are going to go.” “Show us 14 photos of yourself and we can identify who you are. You think you don’t have 14 photos of yourself on the internet? You’ve got Facebook photos! People will find it’s very useful to have devices that remember what you want to do, because you forgot…But society isn’t ready for questions that will be raised as result of user-generated content.”
Read More: ReadWriteWeb.com
Demand Media Extends Content Model To Other Publishers, Hearst And Gannett First To Sign Up
Demand Media on Thursday debuted a new service for publishers to pad their online offerings with the work of independent freelancers. Two of the first properties to employ Content Channels, so-called, include Hearst Corp.’s SFGate.com and Chron.com. “Hearst is the second major publisher to select our product for their sites,” said Steve Semelsberger, SVP and general manager of the Business Solutions Group for Demand Media. (The first major publisher was Gannett’s USA Today, which recently employed Demand to power its “TravelTips” section.) Semelsberger said Demand Media’s studio team worked closely with the editorial teams of both SFGate.com and Chron.com to make sure the Content Channels met their editorial standards. In the case of the Houston Chronicle‘s Chron.com, the team worked with Demand Media to create a “Small Business Resource Center” to complement its existing business news coverage by incorporating thousands of business-related articles and videos. Content Channels also went live this week on San Francisco Chronicle‘s SFGate.com for its “Home Guides” section.
Read More: MediaPost
IAB Report Slams Most Online Research Methods
Watch out, research firms! The Interactive Advertising Bureau has embarked on a broad initiative to improve online brand effectiveness research, and its initial findings aren’t pretty. What’s wrong with most research that attempts to measure ad effectiveness? Small respondent size and low response rates for starters, according to an initial report from the IAB. Above all else, the validity of such research is threatened “by the extremely low response rates achieved in most IAE studies,” according to Paul Lavrakas, Ph.D., the report’s author, and former chief research methodologist for the Nielsen Company. Average research is also “threatened by the near-exclusive use of quasi-experimental research designs rather than classic experimental designs,” in the words of Lavrakas, author of “Telephone Survey Methods: Sampling, Selection, and Supervision.” Worse still, industry research is often compromised by “a lack of valid empirical evidence that the statistical weighting adjustments … adequately correct for the biasing effects,” Lavrakas attests. “In instances where the sample size is at the lower end of this range [less than 800 participants] and the clients want subsample analyses to be conducted … these subsamples may not have enough members in them to provide precise analyses,” Lavrakas concludes. “Thus, subsample analyses based on small sized subsamples [fewer than 100 participants in the subsample] will have relative large sampling errors.”
Read More: MediaPost
Google Disses the Yield Optimizers
This morning, Google released information on how publishers maximize revenues using the DoubleClick Ad Exchange as well as other Google products. The post by Neal Mohan, VP of Product Management, on the Google blog includes a one sheeter. View the post here. And, download the one-sheeter here. There’s not much that’s new here except for an explanation on dynamic allocation. Interesting that the one-sheeter sticks it in the eye of “traditional ‘yield management.’” They put ‘yield management’ in quotes. Google is clearly positioning DART For Publishers (DFP) as the yield optimization solution of the future as its “dynamic allocation” allows publishers to set minimum floors with exchange buyers when managing between direct sold inventory, ad networks or buyer relationships managed through DFP. So, if you’re a publisher, you get to test the market for your impression, compare it with your other relationships and then sell wherever you want.
Read More: AdExchanger
comScore Releases 2009 U.S. Digital Year in Review
comScore presents the 2009 U.S. Digital Year in Review, its annual report on the prevailing digital trends of the past year and their implications for the future. The report looks across the digital landscape to highlight the industry’s leading stories of the year:
- Which consumer trends dominated the digital media scene in 2009?
- How did the economic environment effect e-commerce spending throughout the year?
- What is the state of the digital advertising market?
- How has the popularity of Hulu influenced the consumption of online video?
- How are market enablers such as unlimited data plans, 3G penetration and smartphone adoption driving mobile media usage?
Read More: comScore.com
AdSafe Media on Transparency Into Display Ad Inventory and the iFrame Challenge
AdExchanger.com: Given your observation of a decrease in non-transparent inventory in Q4, what is your sense of momentum for transparency into inventory? Is UGC becoming more or less transparent? Any other momentum stories you can discuss?
DH: We see inventory non-transparency (meaning the lack of real time, source level disclosure of the URL on which an ad is to be served) as a large and growing concern in the display markets, especially with the recent increase in “audience buying” via networks and exchanges. Lack of source level transparency is primarily an unfortunate side effect of inventory “daisy-chaining” (or inter-network reselling) that currently helps facilitate high inventory liquidity in the display marketplaces. As more advertisers begin using these platforms as a primary buying channel, it’s essential that we as an industry balance the positives of liquidity with the risks of not knowing where an ad is being placed. In short, liquidity is good because it equates to more efficient markets and greater inventory utilization; non-transparency is bad because it results in more brand safety risks to advertisers in the form of bad ad placements, and thus less dollars online.
Read More: AdExchanger