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Advertising material must adapt to survive in 2009

Broadcasters, distributors and media buyers agree that because we live Now a video on demand world in which consumers control what they watch and when, the model of radio advertising is broken. And while the media industry is still sorting through their situation on television, perhaps even more disturbing news is that because of difficult economic conditions facing the world going into 2009, all indications are that online advertising spend will dip next year. What can media companies and advertisers to wade into this ecosystem ad? In a word: they will change the way advertising is sold and purchased, delivered and measured.

Traditional audiences are eroding. In October, the four biggest broadcast networks reported declines in audiences between the ages of 18 and 49. Many analysts believe that the eyeballs move to online television. Advertising Age, in a study on social networking and its impact on television, revealed that 25% of users of social networking sites like Facebook have indicated that they spent less time watching television because of the time they spent online. And more than one third of all 12 to 64 years online said they used social networking sites regularly. to the public for diversion of television and use time-shifting digital video recorder (DVR) technology such as TiVo to skip ads while watching TV, advertising revenues will be held in the middle of the distribution are on the decline.

So media companies should simply follow their audience online, right? The image is not so clear. The current economic climate is eroding advertising spending across the board. TechCrunch reports that in the third quarter, Google, Yahoo, Microsoft and AOL collectively had their only increased by 0.6% in the first quarter of online advertising revenues in the quarter. Reports MediaPost.com that, while online advertising revenue is up 11% from a year-day growth against last year's 26% growth has virtually stagnated in 2008. They predict that 2009 will be flat year for the first online ad spending since 2003. Others offer an even more dark. In a survey of participants at AdTech New York private equity firm Halyard Capital is the most predicted digital budgets marketing would be 10-20% in 2009.

And even worse for new media companies: the rates that advertisers pay for ad space digital, as traditionally measured by cost per thousand impressions (CPM), are declining. According to research from Morgan Stanley, the average CPM banner advertising increased from $ 3 to $ 1 over the last ten years. Consensus seems to be is because of the proliferation Inventory available (number of places on the Internet to view these ads). In China, advertisers are paying as little as $ 05 CPM because of the rapid explosion of stocks. MediaPost and predicted that this rate cut, the advertisers pay to extend the online video advertising in 2009, which is an area that has benefited a peak two years at CMP.

But what about those social networks to which viewers are being developed? Do they offer hope? Halyard Capital has revealed that 68% of respondents think social networks are in the strongest position "to develop" among alternative marketing channels over the next two years. Advertisers see a huge potential in social networking as a channel in which to better target advertising to consumers because of all the personal information is shared. And content providers see opportunities to connect traditional media and social networks. Broadcasters are beginning to integrate community features in their online video players. Companies like Joost are tapping into networks like Facebook for social video sharing social.

At first glance, therefore, social networks seem to offer promise as a haven of advertising in an economic downturn. Sites like Facebook, MySpace and YouTube have a huge number of pageviews, a number greater than Average page views per user, and a longer average time-on-site. In a world focused on the MPC, the swimming massive page views is a treasure virtual "inventory" because of the multiplicity of eyeballs. The problem, however, is that the data show that the actual return advertisements on these social networks is absolutely pathetic. The CTR on these sites are 10 to 100 times below the average for banner ads, which were already in the 0.1 to 1 per cent per cent range.

According to Dr. Augustine Fou, senior VP of digital strategy at MRM Worldwide a digital marketing agency, the nature of social networking sites makes them unsuitable for traditional advertising:

"Although that larger Web 1.0 sites (Yahoo, CNET, New York Times, etc.) were the content sites that the cumulative number of massive public support and important consultations pages, the largest Web 2.0 sites are social networking sites. The nature of these two types of sites is very different. Users pass Web 1.0 sites and portals to read the content or do e-mail by themselves. Users go to Web 2.0 social networks to interact with other and are usually so immersed in the socialization, they are still less likely to see, let alone act on the ads, despite the large number of consultations Page generated per session. This may explain in part click on the spectacular fall rates for ads on social networking sites. "

Ted McConnell, general manager of interactive marketing and innovation at Procter & Gamble Co., postulates that social networking sites are not only ineffective channels of advertising, they are totally inappropriate in a market which attempts to alienate the consumers. McConnell asks to advertisers: "What in heaven's name made you think you could monetize real estate in which someone is his break with their girlfriend? He argues that "social media" is not really "media" at all. Media is a one-way communication that contains spaces which constitute inventory for advertising. Social networking is a dialogue between consumers, where advertising becomes an obstacle. Consumers have not intend to create media, they intended to speak to someone.

If television advertising revenue is declining, advertising expenditure on all digital is directed downward, and social networks fail to fulfill their promise reach consumers what advertisers can and media companies do to weather the storm? Advertisers must ensure they get the best return on investment they can on their advertising dollars remaining expenses. Instead of paying for more Globes eye, they can, they should concentrate on advertising in the best position to perform a conversion. Online, it probably indicates a required change from a CPM model, where advertisers pay for the number of people who will see an ad, based on the measurement results. An advertising model based Performance would advertisers pay only for clicks or other actions to target consumers.

McConnell predicted that, as the worsening economy, the wealth of performance-based advertising will increase as the print-based models fail. " 'Spray and pray is a little harder to do when you are under economic pressure, "he said." So the advertising performance will more win shares CPM. "

And according to Dr. Fu, "in the Web 2.0 landscape, advertising, advertisers have already exceeded the cost per thousand impressions (CPM), a cost model for more measurable and accountable per-click (CPC) (model, for example, Google AdWords) in which they pay only when users click, no matter how many times the ad is displayed. Some have even moved to the next step cost per action (CPA), when the advertiser does not pay until the user does the desired action, for example, make a purchase. "

How can media companies respond to demand performance-based advertising? It is not enough simply to make inventory available now these companies must ensure that ads are effective. This means it is more important than ever to target advertising to the consumer right to right at the right time. And media companies will work directly with advertisers to ensure that advertising is closely integrated with the content in a way that ensures the proper context and timing for the message.

A string that offers some interesting promises for targeting mobile content. 62% of participants ADTECH surveyed cited by halyard as mobile advertising platform that will grow most in the next two years. Mobile has the potential to target a consumer at exactly the right time and right place. Imagine walking into a drug store and receive One coupon per text message on your mobile phone for over-counter pain reliever. Such is the power of location-based advertising, made possible by the proliferation of global positioning systems (GPS) in mobile phones, enabling providers to know exactly where you are. This is not science fiction – Companies like Loopt and NAVTEQ have already begun to serve up location-based ads on a handset near you.

And while social networks may not be the Holy Grail in providing a channel for advertising, their vast potential to understand and target consumers may still be effective publicity for the key in a world based on performance. Dr. Fu says that "By redefining social networks as "the collective conversations and actions of their customers, as shown in line" instead of marketers can use social networks as a place to do research-for example, test messages with real clients in a real environment, listen to how clients describe their products or services to their peers or find ideas for new products or how to improve current products. Finally, advertisers can identify influencers, gurus or "Heavies" on social networks (those who are most active in speaking, viewing or sharing) and leave the beta testing and write about their product or service. "

Not only social networks can help advertisers to better identify, understand and influence their goals, they have the potential to extend their reach exponentially. According to Advertising Age, there are "emerging evidence that maps relations among online consumers – the creation of so-called social graph – can be just as valuable as traditional targeting and segmentation to predict how people will respond to marketing messages. "The idea is not only to your target market of consumers identified but the market for other people in this social network consumer. The theory is that advertisers should involve "consumers who are already connected and share values and beliefs, a concept called homophily. "Yahoo and several start-ups are beginning to prove this theory.

Finally, May he yet hope for television. In early November, Dish Network signed an agreement with the advertising technology company Invidi which involves creating of "advanced receivers" capable of "delivering targeted advertisements" and "dynamic commercial integration." According to Advertising Age, what it means is "[r] Ather bombarding millions of viewers with the same ads for a lot of them may not be looking to buy, traders can in the next two to three years, send different ads to different households – ensuring, for example, Procter & Gamble would not pay for ads Pampers monitored by a couple without Tykes Wee and General Motors does not have to show ads for its Hummer vehicles before a room full of fans Prius. "Experts estimate that if consumers are presented with appropriate publicity, they are much less likely to skip the ad on his DVR.

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