New research from Allegra Strategies forecasts that new media advertising formats are set to become a key part of advertising campaigns over the next few years. Online advertising, email and wireless marketing may offer a number of major benefits over traditional advertising media in terms of measurability, interactivity and improved targeting.
Currently, uptake of such medium is slow and a small decline in UK online ad revenues for calendar year 2001 are forecast.
Growth in internet penetration and the previously mentioned benefits of online marketing will lead to strong growth for non-traditional media, says Allegra and new media advertising revenues are forecast to grow by 51.8% per annum, from £159 million in 2000 to £1.3 billion by 2005. Consequently, new media advertising is expected to account for 6.7% of total UK ad revenues by 2005.
Online ad revenue in the UK is predicted to grow from £143 million in 2000 to £458 million by 2005 thanks to a compound annual growth rate of 26.3% during this period and email marketing ad spend is forecast to grow from £12 million in 2000 to £382 million by 2005 with a forecast compound annual growth rate of 98% over this period.
By 2005 the number of SMS marketing to messages UK consumers could reach as much as 2.7 billion per year, or 80 messages per mobile phone per year by December 2005
New Media Revenue Forecasts
| |
2000 |
2005 |
CAGR |
% of total 2005 adspend |
| Online |
£12 million |
£458 million |
26.3 |
2.40% |
| Email |
£12 million |
£382 million |
98 |
15% |
| Wireless |
£4 million |
£439 million |
156% |
N/A |
| Total new media |
£159 million |
£1.3 billion |
51.80% |
6.70% |
Source: Allegra Strategies
