Tag Archives: advertising growth

Digital ad spend in the UK reaches record highs, surpassing the £5 billion mark in 2012 alone!

Research from the Internet Advertising Bureau has revealed a growth in digital advertising in the UK, with mobile accounting for 10% of all digital revenue in 2012.

Digital ad revenue reached an annual high of £5.42 billion last year, a record 12.5% year on year high, mobile advertising was responsible for approximately £526 million, revealing a growth of 148%!

With an increase in Smartphone ownership expected to reach 75% by end of year 2013, it is no surprise that mobile advertising has grown by an astonishing 1,601% up to £13million, even without EE’s 4G prevalent network which will only be made readily available to the majority of operators this autumn.

Mobile Advertising 2013

source: http://images.ientrymail.com/

It is also expected that the majority of search clicks in 2013 will come from mobile devices, with the prediction that mobile advertising “will undoubtedly be a billion pound medium within a few years”. Mobile has reached a milestone as marketers are becoming more attuned to the ‘always connected’ nature of consumers, who expect to engage with content wherever they are. This has resulted in advertisers encouraging consumers in all industries, to invest in integrated campaigns across online and mobile. As Anna Bartz from PwC, said: “The advertising market is shifting toward storytelling and integrated campaigns which give greater prominence to video and display formats with a higher degree of interactivity with the target audience”.

With the likes of social media sites such as Facebook, and with them recently unveiling plans for a Smartphone which it claims will “make the social network the home of Android devices, as it looks to expand its mobile advertising offering”,  it is no wonder that social media has contributed to this astonishing high turnover in digital advertising. With mobile advertising increasing from £265 million to £328.4 million in 2012, meaning that in only 3 years social media revenue has quadrupled at 383%.

Last but not least, video ad revenue is responsible for 12% of all online and mobile display advertising with an overall £160 million revenue, which has helped contribute to such a high digital ad spend in 2012.

The top five display advertising sectors in 2012 are as follows; finance (15%), entertainment and media (13%), retail (12%) and technology (9%).

The Year Ahead

The New Year brought further predictions of gloom rather than boom, with most recent economic data telling a story of continued slow growth in 2013. The Financial Times recently reported that there are two main trends that have emerged in the shopping habits of the nation; the search for value, and the way that we shop, which is migrating to online. These trends are not dissimilar to forecasts for the media landscape in 2013, which it is predicted will also be technology driven and value seeking.

Digital Spending

Source: Four Media

There is no denying that digital has become an intrinsic part of our daily lives in the UK, influencing our routines, shopping habits and ever more prolifically, our media consumption. It is predicted that the number of UK households that own a tablet is likely to double to 10 million in the coming year, and with the advent of 4G mobile broadband, and the increasing integration of Internet-enabled TV, the pace at which our digital media consumption is evolving is impressive.

So what for media in 2013? Current advertising revenue forecasts range between 2.8% and 3.4% growth, and there is universal agreement that 2013 will see two major trends – digital media revenues will continue to outpace other channels (digital is the only media predicted to grow by double figures in 2013), and audiences will migrate to online platforms with the continued integration of mobile and internet.

This increasing transition to digital has seen a shift in how companies do business from a ‘this is how we do it’ mentality to ‘this is what we need to do’, with an emphasis on making things happen in the now. The transition from ‘what’ to ‘how’ can also be seen in the media landscape, with the benefits of a test-and-learn approach being seen across the board, with an increasing focus on digital in the media mix combined with careful understanding and management of risks. It is predicted that this year will be about starting small and learning quickly in order to capitalise on new opportunities in a rapidly evolving media environment.

Further, the point of transaction and engagement are becoming ever closer, with the year ahead forecast to be as much about data capture as engagement. The prevalence of measurable factual information will further aid in the development of targeting opportunities, meaning that communications can become more personalised than ever before.

The focus on measurability and accountability means that having the right capability in terms of analytics and insight will be essential for media agencies to give clients confidence that they will see returns on their media investment from the beginning.

Media agencies that combine a ‘be brave and learn quickly’ mentality with a thorough approach to measurement and analysis will have the opportunity to produce some impressive results in challenging times through innovative campaigns across a wide range of touch points.

Facebook Sees 18.5% Click Through Increases

Click-through rates for Facebook ads in the UK, USA, France, Germany and Canada increased by 18.5% between the second and third quarter of 2011 (TBG Digital).

Growth has been driven by an increase in fan acquisition and application install campaigns, as well as improved effectiveness from ad formats such as Sponsored Stories.

It has been discovered that Facebook is earning more per impression whilst the Cost per Click rates have fallen for advertisers. Cost-per-click rates fell over the third quarter by 10.8%, while cost-per-thousand impressions increased by 7.1%.

Brand advertising is also on the increase, up 6.7% from the second quarter of 2010, and accounts for just over half of all Facebook advertising.

Retail brands had the highest share of impressions at 27% for the quarter, followed by food and drink brands, with a 14% share.

The entertainment sector has seen the steepest growth from the last quarter, growing its share of total impressions to 8% from under 1%.

Simon Mansell, chief executive of TBG Digital said “With true global scale and massive levels of user engagement, Facebook should be the first choice for any brand campaign.”

“The success of Facebook PPC advertising can be attributed to the diverse targeting options available such as demographics, user interests and geo-location. However, Facebook PPC should not be considered as an alternative to PPC on other platforms like Google AdWords. Google PPC targets users based on what they are searching for, whist Facebook PPC will target based on who they are.” Four Opinion– Director of Search Marketing

Riots Swell TV Viewing Figures

London Riots Boost TV ViewingLondon’s ongoing riots have re-highlighted the importance of social media as a news and wider communicative tool, with Twitter, Facebook, and Blackberry Messenger being used for good and ill across the capital and UK.

Less reported, however, is the affect the rioting has had on the viewing figures for TV news channels.

According to BskyB, Sky News achieved a reach of 6.81 million viewers for its coverage on Monday (based on viewers who tuned in for at least 15 minutes).  This gives the channel its highest daily audience figure since 7.3 million tuned in to watch the Iraq war coverage in 2003.

With a reach of 8.8 million, BBC News channel attracted a record-breaking audience, with 3.3 million of the audience viewing in London.

The BBC’s news website also recorded it’s second highest level of UK usage on Tuesday with 6.8 million users – an audience figure only second to the day following last year’s general election.

Through with Click-Through?

Through with Click- Through?

Growth of Digital Advertising

Constantly growing, and with nearly one in four advertising pounds in the UK now spent on it, digital has become  an indispensible part of almost any advertising campaign.

While now established (if continually evolving), digital advertising’s measurability is, however, still in its infancy.

In its early days, the USP of online advertising was its ability to allow consumers to act on the advertisement immediately through clicking on it and to invariably be led to the website of whatever product was being advertised.  From a campaign measurement perspective, this was gold-dust.  Advertisers were able to accurately measure exactly how successful an online campaign was through solid data: the click-through rate.

At first, online advertising was a novelty, with about one in seven users who saw an ad clicking on it.  Fast-forward over a decade, and the click-through-rates have plummeted to a fraction of 1% (0.03% – 0.09% is considered an average).  It’s not that advertising creative has declined in quality – far from it – but the initial novelty has worn off. Crucially, recent ComScore data shows that just 8% of US users account for 80% of clicks.  Most people just don’t click any more.

This doesn’t mean that online advertising has stopped working, just that we need to reconsider how we expect users to engage with it.  When someone sees a Cadbury advert on TV or on a poster, advertisers do not necessarily expect them to immediately purchase a chocolate bar, or log onto the Cadbury website to find out more about the advertised product.
Both of these would in fact be regarded as fairly unusual responses for most forms of traditional advertising.  Instead, what the advertiser in traditional media is largely hoping to achieve is an increase in brand awareness and recall so that when the viewer of the advert decides to make a purchase decision further down the line, they will be favourably influenced by the advert.

Therefore, this line of thinking reasonably progresses, this is how we should view online advertising: as a propagator of brand awareness and influencer of purchasing decisions.  Not as a way to drive viewers immediately to the advertisers website.
The next question, of course, is how do we measure this new definition of online advertising success?

Last year, Microsoft, ComScore and Eyeblaster issued a report in which they analysed the correlation between dwell time (the time a user spent engaged with a rich-media online advert) and campaign success.  Conducted across twenty different campaigns over six months, the report calculated a ‘dwell score’ by multiplying the amount of time a user spent engaging with the advert with the rate of engagement.

The report found that the higher the dwell score, the more positive a viewer’s behaviour will be towards the brand after seeing it.  In particular, the data showed that high-dwell campaigns delivered a 69% improvement in a campaign’s effectiveness at increasing brand site visits.  Those exposed to the high-dwell campaigns were also 39% more likely to make a branded search when they came to purchase a particular product.

These are impressive results, and an impressive, quantifiable measurement method that goes beyond the simple click-through to give more holistic, and therefore infinitely more useful, campaign reporting.

The only catch is that this method relies on rich-media adverts.  However, video adverts are on the rise, with Cisco estimating that in two years 90% of all web traffic will be video.  As online advertising, particularly brand advertising, continues to employ video, advertisers have the potential to revolutionalise how they approach, how they measure,  and therefore how they  improve, online advertising.

Digital to Drive Media Growth over the Next 4 years

digital advertising spend increasesAccording to a recent study by Pricewaterhouse Coopers (PwC), digital innovation is expected to boost the value of the UK’s media industry by an average of 3.7% a year over the next four years, to total £59.6bn by 2015.

The UK is expected to keep its position as the world’s fifth biggest media market in terms of value by 2015, driven by digital products.

It is predicted that the only segment of the UK market set for double-digit growth over the period will be internet advertising (11.2% annually to 2015), providing new sources of income for traditional media owners expanding onto new platforms.

In the UK, it is also predicted that the payment of subscriptions and the licence fee would keep the television industry as the most valuable media sector by 2015 with a value of $14.7bn, an average yearly increase of 4.2% over the four years.

Of the 12 countries with adspend in media and entertainment markets above $25bn, only earthquake-affected Japan and developed Germany are expected to experience slower growth than the UK.

China’s market is expected to grow by 11.6% over this period to $148.2bn by 2015. Brazil will see a similar level of growth – 11.4% to $56.7m.

France is estimated to see a 4% growth annually to a wealth of $80.9bn by 2015; Italy is expected to grow by the same figure to a valuation of $51.3bn while Spain will grow by 4.8% to a valuation of $33.5bn.

The US, still the largest global media and entertainments market by a considerable distance, is expected to record growth of 4.6% to be worth $555.3bn by 2015.

PwC concluded in their findings that the next four years would represent a “golden age for the empowered consumer” as the demand for digital experiences increases and becomes the norm.

Convenience, experience and quality are the key ingredients that matter to consumers when choosing from the menu of content and delivery channels now available. Alongside these sit participation and privilege. Consumers enjoy playing an active role in shaping their content plus they are happy to pay for privileges which enable them to “jump the queue” to get earlier access to content.

The challenge for companies is reported to be in turning these five attributes into sustainable, profitable and engaged relationships with the consumer, by offering advantages which outweigh the attractiveness of free content.