Summary:

The latest figures for online ad spending looked pretty good for the first half of the year, but as the Interactive Advertising Bureau’s rep…

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The latest figures for online ad spending looked pretty good for the first half of the year, but as the Interactive Advertising Bureau’s report shows, even though display is rising, the “premium” impression-based ads still have a long way to go to catch up to performance-based ads, which tend to be of the cheaper, “click here” variety. A study from ad tech firm Collective suggests that agencies and marketers are still getting used to the internet as a branding medium. Plus, even as display begins to offer more dazzling creative opportunities, it’s the data that matters more to ad buyers.

Display accounted for 37 percent of all interactive spend in the first half of 2011, with search remaining the leading online category at 49 percent of the total, according to the IAB.

Premium publishers have long sought to make online viewed as more of a branding medium instead of a direct response vehicle. Ads using performance-based models increased faster than ads using impression-based models, rising to $9.6 billion, the IAB reported for the second half of the year. Spending on impression-based ads — ones that have prices calculated on how many pairs of “eyeballs” are likely to see the placement, as opposed to ones priced on clicks or other actions — was up 10.8 percent, though that pricing model accounted for only 31 percent of total ads, down from 35 percent year-over-year.

A study of 400 agency media and brand marketers conducted by Advertiser Perceptions for Collective suggests the industry is still getting used to the idea of “branding” as part of the rationale for spending ad dollars online:

– 57 percent of agencies say the majority of their online spend is for brand objectives, yet only 11 percent cite ad creative – a hallmark of brand advertising – as critical to the campaign’s success.
— 60 percent of marketers anticipate increasing social media spending in the next 6 months, although only 12 percent believe that it holds value for brands.
— 95 percent of marketers cite running in a brand-safe environment as critical, yet 88 percent of agencies said that they would not have a problem running client campaigns within user-generated content.
— 60 percent of agencies cited brand recall and intent to purchase as the most important measures of online success. However, ‘performance’ (clicks/conversions) remains the key criteria agencies say they use to evaluate media.

There is hope that publishers can still attract premium brand dollars at some point. The idea of “creative” online advertising is still a new concept to marketers. As Collective CEO Joe Apprendi says, what’s needed is more engaging ads.

“Most optimization to date has focused on the ‘who’, which represents the data piece, and the ‘where’ –the ad environment– while not enough emphasis has been placed on optimization of the creative, or the ‘what,'” he said in a statement. Video is one area that lends itself to the kind of lucrative, creative branding plays that reminds major advertisers of TV.

For the most part, as long as web ads are created cheaply, the spending on individual ads and placements will remain low-cost as well. The report can be downloaded here.

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