Internet advertising spend will represent 10% of total American ad dollars by 2010, doubling from 5% last year to grow at an annual rate of 14% over the next five years, according to a new report from Parks Associates.
The report, entitled “The Changing Face of Advertising in the Digital Age,” cites data from the firm’s consumer study “Digital Entertainment: Changing Consumer Habits,” and also finds 21% of Internet users consider online adverts the most relevant form of marketing for them, rating the medium far above traditional formats such as newspapers, magazines, and radio.
“In the next few years, the Internet will become a mainstream ad platform and attract top dollars from advertisers,” explained Harry Wang, research analyst at Parks Associates. “Because the Internet is an interactive and versatile platform and offers rich consumer usage data, advertisers can improve their ad targetability and achieve better results.”
Better targeting and increased accountability are of the utmost importance to advertisers, who are set to suffer from increased audience fragmentation and a “lack of in-depth media consumption data” according to Parks Associates.
The company’s research claims many familiar brands, including Anheuser-Busch, Procter & Gamble, Verizon, and Wachovia, have been moving money out of network TV and into the web, demonstrating growing confidence in online advertising.
Wang continued: “Traditional media companies are fully aware of this ongoing change in the advertising industry. The internet has altered the standard for the entire ad world, and traditional media have to respond by making their media platforms more interactive and results-oriented.”
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