Video Ads Gain 22%, Static & Search Ads Lose

JupiterResearch recently reported that, even with a lousy economy, the amount of money spent on online advertising should continue to grow at double-digit rates all the way through to 2013. A no brainer. Since online should do better than offline advertising because the accountability it offers – the ability to track its’ effectiveness is much better than with other types of advertising.

Total online ad spending is expected to increase about 20 % in 2008. Until 2013, Jupiter expects total online ad spending to have an annual growth rate of 13%. By comparison, offline advertising is only expected to grow 4% over the same period. Print advertising will shrink, TV will stabilize and mobile will make up for the overall loss.

Search advertising will still be the largest category, but according to Jupiter’s research the growth rate for search advertising will slow because of an “inability to tap into small local advertisers and a steady maturation of the paid search market.”

This is so logical. Already, Google is at 71% share of search (Compete) and 85% share of ad dollars (Covario). That means that marketers are paying more and more for clicks. If costs per click continue to spiral upward buying it just won’t be cost effective anymore and eventually people will pull back on their pay-per-click budgets.

Display advertising and classified advertising are expected to do quite well. At first display advertising growth could drop slightly because of short-term economic problems. However, the category will rebound for 14% annual growth over the full period of the report. Likewise, classified ad spending is forecast to be 20% of the total online ad market, while growing at annual 9%rate.

And the winners are: Rich media and Video. Not surprisingly, the biggest increase is seen in video advertising. Video advertising, in fact, is expected to increase 400% to $5.1 billion in 2013. Jupiter predicts that static and text ads will have lost 22% share by 2013 as advertisers focus on rich media and video.

Source: copypaste media


~ by digivine on August 13, 2008.

One Response to “Video Ads Gain 22%, Static & Search Ads Lose”

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