According to the latest report from data analysts eMarketer, this year will see US online advertising revenue grow by 20% to reach just under $40 billion. The growth in digital advertising’s revenue is in stark contrast to print media’s figures which have fallen by 6%, meaning that this year will see the total spent on online ads exceeding print media by an estimated $6 billion. A further study published by the media communications company Carat forecasts that worldwide advertising figures for 2013 will see a global difference between digital and print advertising spending of 5.8% in digital’s favour. What’s more, it is not just print media’s advertising dominance that is being challenged by digital. eMarketer’s study also predicted that by 2016 online ad spending will have reached $62 billion, the same figure currently being spent on television advertising.
Why is Digital Advertising Booming?
So far it appears there are three key factors in the growth of digital advertising
1. Ever Growing Internet Population – With each passing year there is a rise in the number of people using the internet and this growth is being aided by the increased penetration of mobile internet access. As the number of internet users grows, so too does online investment in order to match the amplified consumer appetite for online videos, pictures and social media.
2. Online Advertising’s Measurability – Lord Leverhulme once famously said ‘I know that half of my advertising budget is wasted, I’m just not sure which half’. Well, advertising digitally puts this problem to bed. The beauty of online advertising is that you can track the success of your ad campaign. By only paying when your ad is clicked on you can ensure that your advertising budget is being used wisely. With digital advertising you can also track the data to discover which campaigns are working and which need a little tweaking. This is invaluable information for companies on a budget and is simply unobtainable when advertising in print.
3. Great Return on Investment (ROI) – For a few years now online marketing has surpassed the ROI provided by offline advertising. This is because readers are far more likely to respond to digital advertising compared to a printed ad. This claim is backed up by a study completed by media research firm Affinity. Their study found that readers were much more likely to respond to an iPad advert by following a link or making a purchase than print readers who had seen the equivalent advert. Affinity’s Managing Director Tom Robinson puts this down to the interactivity of online advertising. He states that “digital offers more opportunities to respond with the interactivity, the links built in, the videos, and that is directly reflected in the fact that we’re getting higher reader ad effectiveness scores on the digital side”.
Methods of Advertising Online
1. Pay Per Click (PPC) – PPC is another method of online advertising using search engines. PPC involves bidding for keywords. When you win your bid, your advert will then appear in the ‘sponsored section’ whenever people search for terms related to your website or product. As its name suggests, you only pay for your ad if a user interacts with it.
2. Search Engine Optimisation (SEO) – Search engines are the main source of traffic so utilising them is key for generating online revenue. In the organic results (i.e. not paid for ads) search engines rank the results based on how relevant they are to the desired search terms, the higher your site, the more traffic you will receive. SEO is based around making sure your site is as well equipped as possible to rank well for the keyword terms that matter most for your business.
3. Email Marketing – Email Marketing is a powerful way of gaining online revenue. Carefully constructed emails can be used to acquire new customers, tempt old ones back, advertise products and enhance customer loyalty.
These are just three ways of increasing traffic to your site using online advertising. If you would like to talk to us about these or any other method of generating online sales such as social media or improving your website, feel free to call for a consultation with one of our experts.