Tweet As US online ad spending closes in this year on $40 billion, the bulk of that spending will go toward just a few formats: search, banners and video advertising.

These three formats will make up upwards of 80% of all spending through 2016, eMarketer predicts. Search is and will remain by far the leading format, although its share of total online ad spending will slip slightly from 2012 to 2016 as online video ad spending nearly doubles its share from 7.9% in 2012 to 15% in 2016.

Video continues to be the fastest-growing online ad format, with spending increasing by nearly 55% this year, following growth of 42.1% in 2011. Strong double-digit growth will continue throughout eMarketer’s forecast period. Growth for several other formats remains strong as well, especially with the prospect of a major national election and summer Olympic Games in 2012 to boost rates.

The continued dominance of search as the leading digital advertising format comes as little surprise, with its near-universal adoption rates among consumers and popularity on both the desktop and mobile web. Meanwhile, the continued strength of banner ads across desktop and mobile devices, coupled with a surge in video ad spending on both platforms, constitute the two most important and related storylines in display advertising.

eMarketer forms its forecast for online advertising spending though a meta-analysis of reported revenues from major ad-selling companies; results from benchmark sources the Interactive Advertising Bureau and PricewaterhouseCoopers; and research estimates and methodologies from dozens of firms that track ad spending.

Source:eMarketer

Twitter’s ad revenue growth will fall from the triple digits last year to “mere” 83% growth in 2012, eMarketer predicts, reaching nearly $260 million worldwide by the end of this year.

The social media service, which is continuing to roll out self-serve ad offerings, will see growth in ad revenues around the world taper off over the next three years yet remain solidly positive. By 2014, eMarketer estimates, Twitter will enjoy worldwide ad revenues of $540 million.

Currently, 90% of Twitter’s revenues come from US sources, with other countries contributing just $26 million to its ad revenues this year. The site will have diversified its revenue sources slightly by 2014, but 83% of dollars will still come from the US.

LinkedIn, which has lower revenues and a lower growth rate overall than Twitter, gets a greater share of its ad dollars from outside the US.

This year, when the site will see $226 million in ad revenues, a 46.1% increase over 2011, 32% of that money will come from abroad.

By 2014, US advertisers will account for 60% of LinkedIn’s revenues of $405.6 million, according to eMarketer estimates.

eMarketer forms its estimates of social network ad revenues through a meta-analysis of data from dozens of research firms, company information and industry trends. This forecast represents an upward revision of LinkedIn’s revenues and growth rate compared with eMarketer’s previous forecast, issued in September 2011, due to a stronger-than-expected advertising program at the site. Twitter’s ad revenues are close to those expected last September, with growth continuing on the expected trajectory for an additional year.

Source:eMarketer

US online ad spending will post growth well above 20% again this year to reach nearly $40 billion, eMarketer estimates, as the internet continues to prove its worth to advertisers in a tough economic climate.

“Advertisers’ comfort level with integrated marketing is greater than ever, and this is helping more advertisers—and more large brands—put a greater share of dollars online,” said David Hallerman, eMarketer principal analyst.

Double-digit growth is expected through 2014, when US online ad spending will reach $52.8 billion. In 2016, eMarketer expects advertisers to spend $62 billion online.

Fast growth has put online ahead of some traditional media, especially print newspapers and magazines. This year, US online ad spending will exceed the total spent on print magazines and newspapers for the first time, at $39.5 billion vs. $33.8 billion. And as online shoots up, the print total will continue to inch downward.

Spending on TV, however, appears largely unaffected by the growth of online. As internet ad spending rises, so will TV—albeit more slowly, and from a larger base. eMarketer estimates TV will grab $72 billion in US ad dollars in 2016, $10 billion more than will go online.

Overall, eMarketer expects total media ad spending to grow 6.7% this year to $169.5 billion, boosted by national election campaigns and gains in mobile spending. Growth will be in the 3% to 4% range for the remainder of the forecast period, with spending reaching nearly $200 billion by 2016. Online will be a major driver of that growth and will represent nearly a third of total media ad spending that year. Traditional media ad spending—aside from a few bright spots, like TV—will stagnate during the forecast period.

Source:eMarketer

Poland is a rare country where online advertising is already twice as large as newspaper advertising. If that's the future for other advertising markets, then the experiences of the Agora group provide important lessons for newspaper advertising departments everywhere.

Anna Podkowinska, the Revenue Director for Internet Agora, and Marek Tretyn, General Director of Advertising Sales, represent the company's print and digital worlds. How they work together for digital and print success will be the subject of a major presentation at the World Newspaper Advertising Conference, to be held on 1 and 2 March in Prague, Czech Republic.

For the first time, Ms Podkowinska and Mr Tretyn will tell how they carried out a nationwide reorganisation of 20 local sales offices to reflect the changing Polish ad market. The presentation, "Structure follows strategy: Process integration digital & print," will cover the entire strategy, including offers, workflow and results.

Online media took 17 percent of the total Polish advertising market in the third quarter of 2011, compared with 8.5 percent for print, and online represents 42 percent of Agora's ad revenues. Both Agora's online and print businesses are profitable, with EBITDA margins of 10 percent for digital and 20 percent for print last year.

More than 300 newspaper advertising executives are expected to attend the 22nd World Newspaper Advertising Conference, organised by the World Association of Newspapers and News Publishers (WAN-IFRA). The conference provides strategies and ideas to help newspapers protect and increase advertising revenues in highly competitive markets. Full conference details can be found here.

In the past, a combination of mass media and traditional local advertising was enough to draw consumers toward a national brand’s local store or service. But as the internet and mobile devices whet consumers’ appetites for immediate and relevant local information, national advertisers are also looking to local online advertising to reinforce their local brand presence.

“Local search, mobile devices, hyperlocal communities and daily deals are gaining popularity with consumers,” said Lauren Fisher, eMarketer writer/analyst and author of the new report, “Local Online Advertising: Digital Trends, Challenges and Opportunities.” “As the go-to digital sources for local information, each offers on-demand access to community news and information and provides brands a distinct way to engage with US consumers on a local level.”

Research firms agree investment in US local online advertising is growing. Some even project it will outpace total online ad spending growth in 2012 and beyond. But just how much advertisers are investing is hard to say as research firms remain at odds on how to define and measure local online advertising.

BIA/Kelsey, for example, defines local online advertising as “any form of advertising that targets a specific, localized audience or location.” This includes search and display ad spend from all advertisers, including small and medium-sized businesses (SMBs) and national brands spending locally.

MAGNAGLOBAL, however, takes a more narrow approach to classifying local online ad spending, including only dollars spent on local TV, newspaper and radio sites in its estimates. Local paid search and display ad dollars spent elsewhere are not included.

Borrell Associates’ approach is similar to BIA/Kelsey’s in that it includes local ad spending across pure-play sites, TV, radio, cable, newspaper, magazines and internet yellow pages (IYPs). But unlike BIA/Kelsey, Borrell’s estimates do not include national ad dollars spent on local online ad placements.

“With definitions and methodologies so distinct, a true estimate of local online ad spending remains elusive,” said Fisher. “For now, similarities in projected local online ad spending growth and consumer interests remain the best indicators of current and future advertiser investment.”
 

And what are the primary local online channels consumers are indicating their interest in?

The adoption of local search, mobile devices, hyperlocal sites and daily deals is real and growing as each of these digital sources provide consumers with on-demand access to relevant community information. Their resulting popularity is already drawing the attention—and ad dollars—of national brands seeking meaningful ways to connect with the growing mass of consumers who have made the move to digital.

Source:eMarketer

Companies can no longer ignore the growing online population, and many have already found ways to successfully reach both online and offline audiences using multichannel advertising.

Still, a number of brands shy away from multichannel advertising. One often-cited reason is the lesser audience reach of online when compared to traditional mass media, such as TV.

But difficulties associated with integrating and measuring the integration of online and offline advertising are also to blame. According to media buying software provider STRATA, merging traditional and digital advertising into one campaign was a challenge for 38% of US ad agencies in Q3 2011, down from 46.4% in Q2 of the same year.

Challenges with measuring overall investment likely contribute to the reluctance to try multichannel advertising.

The quarter-over-quarter decline in respondents citing difficulty with integrating campaigns would seem to suggest agencies and their clients are becoming more comfortable with multichannel advertising, but overall adoption remains low.

In another study, STRATA found more than half of US media buyers said less than 25% of their clients are running online and offline-integrated advertising campaigns. Approximately one in four media buyers had no clients using a multichannel advertising strategy.

Findings from McKinsey and Company suggest online’s confusing and incompatible set of metrics may be most at fault.

Marketing executives worldwide said their top digital challenges were metrics-related items, such as generating and leveraging customer insights from their marketing efforts (32%) and assessing digital marketing performance using disparate metrics for online and offline marketing (11%). Brand reputation and management, particularly as it pertains to social media, was also a primary obstacle, no doubt due to the difficulty of controlling—and perhaps measuring—brand-centric conversations across social media.

When considering online metrics, marketing executives worldwide were most concerned with their inability to quantify the financial impact of their digital marketing programs. Metrics such as cost-per-impression (CPM) and clickthrough rate (CTR) can tell marketers about the performance of online advertising, but they cannot quantify bottom-line effects.

In addition, 23% found difficulty with the fact that digital metrics are not as similar to traditional metrics. But executives might prefer online to conform to traditional metrics: 24% said online metrics are often hard to understand.

Such confusion does not bode well for those eager to see more brands move ad dollars online. Though companies have forged ahead online in spite of the challenges of executing and measuring a multichannel advertising strategy, it appears many will continue to hesitate so long as metrics remain misaligned and online measurement remains a challenge.

Source:eMarketer

Whether they think of it as magnetic content or advertising, marketers are increasingly focused on creating video assets. This type of media reproduces the richness consumers associate with TV, often at a lower cost. And if online venues tend to fall short of TV when it comes to reach, they make up the difference by engaging viewers in an active, lean-forward mode.

The virtuous circle of content and technology adoption that consumers are experiencing is also fueling this trend. eMarketer estimates that US online video ad spending will grow by a compound annual rate of 38% in a five-year span ending in 2015, making this by far the fastest-rising category of online spending.

By 2015, video ad spending will reach $7.11 billion, up from $2.16 billion in 2011. In the past year alone, growth was 52.1%.

Similarly, in the UK video advertising will lead the pack, growing by a compound annual rate of 65% over five years. By 2015, UK video online ad spending will reach $850 million, compared with $150 million in 2011. As a percentage of total online advertising, video will grow to 8.2% in 2015 from 2.1% in 2011.

Still, challenges remain, including the high price of online video ads and the need for better reach and measurement. Several factors will mitigate these problems, making the upward course for video ad spending strong in 2012 and beyond. These factors include better filtering technologies for user-generated content, so publishers can better monetize it with ads; the emergence of cost per view and cost per engagement pricing structures; the increased use of interactive ad units and magnetic content; and personalization and targeting of video ads.

Source:eMarketer

With a population highly engaged in living digitally and an economy less troubled than many others, Canada will see strong growth in online ad spending in the next few years. Spending, though, will still not rival US levels—even on a per-person basis.

eMarketer estimates that advertisers in Canada will spend over $2.5 billion online this year, up 18.5% over 2010. Online ad spending increases will continue in the double digits through 2014, but taper off gradually during the period. In 2015, ad spending will grow just shy of 10%, to surpass $4 billion.

Online Ad Spending in Canada, 2010-2015 (billions of US$ and % change)

These gains in online spending will come against a backdrop of far more modest gains in total ad spending in Canada. That figure is expected to rise from $11.65 billion last year to $14.28 billion in 2015.

Within online, video advertising will have the highest growth rates during the forecast period, followed by search, which has the highest spending overall.

With the overall size of Canada’s internet population no longer in its phase of rapid growth, big increases in online ad spending will inevitably mean a rise in the amount that is spent per internet user. eMarketer expects online ad spending per internet user in Canada to climb from $99 this year to $149 in 2015.

Online Ad Spending per Internet User in Canada and the US, 2011 & 2015 (in US$)

But even these increases put it far off the mark set by the US, where advertisers will spend $135 per internet user to advertise online this year, a figure that will rise to $192 by 2015, eMarketer estimates.

eMarketer benchmarks its Canadian online ad spending forecast against data from the IAB Canada, for which the last full year measured was 2010. US online ad spending forecasts are benchmarked against IAB/PwC data, for which the last full year measured was also 2010.

Source: eMarketer

New York:The rapid growth of Facebook and Twitter will push worldwide social network ad revenues to $5.54 billion this year and nearly $10 billion in 2013, according to a new forecast by eMarketer.

“Social networks have cemented their place in advertising,” said eMarketer principal analyst Debra Aho Williamson. “More marketers than ever believe their brands should be engaging with consumers on social networks—and advertising is an increasingly successful tool for doing so.”

 
The bulk of these dollars, in the US and around the world, will go to Facebook, while a much smaller share will go to Twitter and other social networks. eMarketer's first forecast of ad revenues for LinkedIn predicts the site will account for 3% of worldwide social network ad revenues this year. The site has more than tripled its ad dollars in two years, though growth is tapering off.

“Facebook will get nearly seven out of every 10 dollars spent on social network advertising worldwide in 2011,” said Williamson. “Twitter’s share will be around 3%.”

 
Social network advertising spending in the US will reach $2.74 billion this year, but more rapid growth elsewhere will mean spending outside the country will account for a slightly greater share each year, eMarketer estimates.

By 2013, non-US revenues will make up 51.9% of the total. In the US, social networks will make $4.81 billion from ads that year.

eMarketer had previously forecast in January 2011 that social network ad revenues worldwide would reach $5.97 billion in 2011, up 71.6% from $3.48 billion in 2010. This downward revision is mostly the result of eMarketer’s slightly lower estimate for worldwide ad revenues at Facebook—which comes as some advertisers are still cautious about Facebook’s low clickthrough rates and others feel they can successfully engage consumers without advertising on the site.

“As with eMarketer’s Facebook forecast, the revision should not be taken as a sign that social network advertising in general is losing momentum,” said Williamson.

Social network ad revenues worldwide are expected to grow 55.6% this year, eMarketer estimates, and 8.8% of online ad dollars in the US and 6.9% worldwide will go to social networking sites. By 2013, social network ad revenues will make up 11.7% of all online ad spending in the US and 9.4% around the world.

 
eMarketer forms its estimates of social network ad revenues based on a meta-analysis of estimates of consumer usage, marketer usage, ad pricing and impressions, as well as revenue estimates from research firms and other sources, and from interviews with industry executives.

Reston: comScore, Inc. has announced the availability of Ad Metrix Social, a powerful enhancement to comScore’s leading competitive display ad intelligence product, that provides greater visibility into display ads appearing on social networking sites and socially-enabled display ads appearing across the web. This new capability is available for all countries currently reportable in Ad Metrix: U.S., Canada, U.K., France and Germany.

“comScore is excited to introduce this new Social module to our Ad Metrix product, offering clients unparalleled visibility into the social side of the display advertising landscape,” said Jeff Hackett, comScore Executive Vice President. “Social networking publishers, led by Facebook, not only account for one out of every three display ads appearing online today, but they are increasingly being woven into the fabric of existing display campaigns. comScore now offers advertisers and agencies a unique way to understand the intersection of social media and display advertising.”

Socially-Published Ads vs. Socially-Enabled Ads:

The core enhancements to Ad Metrix involve detailed reporting and analysis of two different types of social display ads: socially-published ads and socially-enabled ads. Socially-published ads refer to any brand’s display ads that appear on social networking sites, such as Facebook and Linkedin. In order to improve brand-level classification of the non-IAB standard hybrid text/image ads that appear on Facebook, comScore developed a proprietary classification technology to assign these ads to the appropriate brands.

Socially-enabled ads are standard IAB display ads that click through to Facebook or other social networking sites, often including an emblem with verbiage such as “Like us on Facebook” Or “Follow us on Twitter.” Increasingly, brands are utilizing these social calls-to-action in their display ad campaigns as a means of bolstering their social media presence.

Top 10 “Most Social” Display Advertisers :

The top display advertiser in terms of its number of socially-published ads in August was AT&T with 3.9 billion. AT&T, the top display advertiser overall, had a share of ads published on social media sites similar to that of the total U.S. online ad universe. Among the top ten social display advertisers, IAC had the highest percentage of ads published on a social media site at 38.8 percent, 31 percent higher than the total Internet average. Each of the other top ten display advertisers on social media sites were somewhat underrepresented on these sites in relation to the total.

Mars Incorporated ranked #1 on the list of the top socially-enabled display advertisers in August with nearly 300 million impressions among its brands, which include popular candy brands M&Ms, Snickers and Skittles. Nearly 30 percent of Mars Inc.’s display ads were socially-enabled – approximately 42 times higher than the total online average. Kraft Foods ranked second with 179 million socially-enabled display ad impressions, followed by Energizer Holdings with 101 million and General Motors at 97 million. Nearly all of the top ten advertisers were consumer packaged goods companies, highlighting an industry segment that is currently demonstrating the heaviest focus on these types of advertising messages.