Marketers are shifting their adspend onto online, with 60% planning to raise their online advertising expenditure in 2006, according to new research from online magazine, Direct.
The new 2005 Online Marketing Survey shows that marketers are allotting 41% of marketing budgets to online channels this year, taking money away from traditional direct marketing channels. The survey found that marketers allocated 75% for the old channels last year, compared to just 59% this year.
Direct also found that marketers intended to increase online spend, with 57% of direct marketers planning further online marketing increases in 2006. The online magazine claimed that most of the funds are going into search engine marketing, analytics and website customisation.
This switch is shown to be paying off for marketers, with the survey revealing that online sales now account for 25% of the respondents’ total revenues, up from 20% compared to the same period last year.
Online advertising is predicted to enjoy substantial growth over the coming years, with the latest estimates from Jupiter Research forecasting the medium to hit $18.9 billion by 2010, up 59% from $11.9 billion this year (see Online Adspend To Hit $18.9 Billion By 2010).
Financial services company, Goldman Sachs, has predicted 2005 to be a bullish year for online advertising, forecasting the market to increase by 28% year on year, to reach $12.3 billion (see Goldman Sachs Predicts Online Adspend To Rise By 28% In 2005).
Forecasts released earlier this month by Forrester Research are more optimistic than Goldman Sachs, predicting online adspend to reach $14.7 billion this year, a 23% increase on its 2004 estimates (see US Online Ad and Marketing Spend To Reach $14.7 Billion in 2005).
Analyst eMarketer’s predictions are closer to Goldman Sachs’, projecting online advertising to hit $12.9 billion in 2005, a 34% rise on eMarketer’s 2004 forecast (see Online Adspend To Hit $13 Billion In 2005).
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