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Marketers will
increase online ad spending by as much as 30
percent in 2005, according to a recent survey
of media planners and buyers conducted by
Deutsche Bank in conjunction with MediaPost.
For the study, released today, Deutsche Bank
questioned 100 media executives in December
about their clients' experiences with Internet
advertising in 2004 and their plans for this
year. This survey, which was conducted online
by InsightExpress using members of the
MediaPost advisory panel, is the first of an
ongoing series of quarterly studies of media
professionals by MediaPost and Deutsche Bank.
The results pointed to a continued strength in
online marketing, with media executives saying
not only that their clients upped their online
spending during the end-of-year holiday
season, but also that they expected to
increase it even more in the first quarter of
this year.
"There's good momentum coming in to Q1," said
Deutsche Bank Senior Analyst Jeetil Patel.
"Marketers are actually budgeting interactive
into their media mix." Eighty percent of
respondents forecast that their clients would
spend more in the first three months of 2005
than in the last three months of last year.
Nearly one out of three respondents--27
percent--expected their clients would spend
between 11 percent and 30 percent more in the
first quarter of this year than the last
quarter of 2004. An additional 12 percent of
respondents expected their clients'
first-quarter online budgets to spike by 30
percent or more, while 41 percent expected
their clients to up spending by 10 percent
more in the first quarter of 2005 than the
last three months of last year.
Based on the responses showing an increased ad
spend in the first quarter--a traditionally
slow advertising season--Deutsche Bank
predicted a year-over-year leap in Internet
advertising by up to 30 percent, said Patel.
That's about the same as the increase from
2003 to last year, according to eMarketer
estimates.
Media execs surveyed also reported a rise in
the cost of inventory for the fourth quarter.
Ten percent of respondents thought
cost-per-thousand impressions rose by at least
11 percent, while 62 percent said it increased
by 10 percent or less. An additional 28
percent reported a decrease in
cost-per-thousand impressions.
When it came to premium inventory, the price
increase was steeper. Thirty-two percent of
respondents said the cost-per-thousand
impressions premium spots--streaming video,
top-layer rich media, full-page arrivals, and
the like--jumped by between 11 percent and 30
percent; an additional 5 percent of
respondents said the price hike was at least
30 percent. Slightly more than half of
respondents--51 percent--reported a price hike
of up to 10 percent for premium inventory,
while only 3 percent of respondents said
premium costs dropped.
Respondents allocated more ad dollars to
branding campaigns than other types of
advertising. They said they allocated 41.8
percent of their clients' online dollars to
branded ads, 24.1 percent to direct response,
15.3 percent to paid search, 10.3 percent to
e-mail, 4.9 percent to affiliate marketing,
and 3.6 percent to other Internet advertising.
Where did they spend their online branding
dollars? The largest proportion of media
buys--34 percent--went to targeted content
sites such as iVillage, MarketWatch, and CNET.
A quarter of the budget--25 percent--went to
the three largest portals, Yahoo!, MSN, and
AOL.
Respondents also disclosed that 14 percent of
online ad dollars were allocated to Web sites
of local TV, newspaper, and media, and 12
percent went to ad networks such as ValueClick,
Advertising.com, and Burst.
When it comes to the future, half of all
respondents said they expected behavioral
targeting to be the single largest area of
focus for themselves and their clients in the
next six to 12 months. An additional 21
percent said online video ads would be the
primary focal point, while 16 percent expect
to focus on local search or pay-per-call. |
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