Tough markets trigger creative thinking, which means a wave of rebuilds
on the way for failing brand sites, weak online media and under
performing e-retailers. Collating this month's stories for Digital
Intelligence, we're seeing the innovation start. For those getting it
right, the prizes are rich: here in the UK, the switch to online
shopping continues with the latest research showing that over 11m Brits
are shopping on the web at least twice a week.
For many firms it also means a leap into long delayed training of their
teams to find smarter uses of precious marketing budgets; getting more
value from agencies and online media. The web will prove the deciding
factor for many consumer brands and B2B services.
We're wishing our friends and partners a big slice of digital cake in
the run up to the biggest e-commerce Christmas so far.
Best from all @ Digital
Danny Meadows-Klue
Founder and Chief Executive
Digital Strategy Consulting
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Advertising |
UK online adspend keeps rising as total ad market drops
The latest IAB/PwC figures show that online
advertising in the UK grew 21% year-on-year in the first half of 2008
to reach £1.7bn as the total ad market fell 0.7% to £9bn. Online took
18.7% of UK adspend, behind total press display (19.3%) and TV
(21.7%). Search advertising led the growth increasing 28% to account
for 58.3% of all online adspend. Display was up 16.3%, while online
classifieds grew 30.2%.
Overall, growth rates were down on the first half of 2007 when they
reached 41.3% on online adspend of £1.3bn. Guy Phillipson, IAB UK's
Chief Executive Officer said: "Online is not immune from the economic
downturn, but while other sectors see falls in expenditure the
internet is still experiencing an incredible increase and is propping
up the entire advertising market."
IAB UK:
http://www.iabuk.net,
07/10/2008
UK advertising spending by media, first half 2008
Source: IAB UK
IAB UK:
http://www.iabuk.net
Online adspend slows in US
New US figures from the IAB and PwC show
that online adspend grew 15% year-on-year in the first half of 2008 to
reach $11.5bn, writes ClickZ. Q2 adspend was up 13% year-on-year to
$5.7bn but was down 0.3% from Q1 this year. Search revenues were up
24% to $5.1bn or 44% of all online adspend. Display advertising rose
19% to $3.8bn (33% of all online adspend).
PwC expect that online adspend in the US will total between $22bn and
$25bn for the whole year. This estimate is further reinforced by data
from eMarketer which has projected online adspend figures of $24.5bn
on annual growth of 17.4%.
From ClickZ:
http://www.clickz.com,
07/10/2008
IAB US:
http://www.iab.net
% of second quarter revenues
Source: IAB US
IAB US:
http://www.iab.net
US online advertising spending growth 2008 & 2009
Source: eMarketer
eMarketer:
http://www.emarketer.com
Bellwether Report finds online sector still positive
The latest Bellwether Report from the Institute
of Practitioners in Advertising (IPA) has found that 35% of companies
revised their marketing budgets down in Q3 against only 12% reporting
a rise, writes The Guardian. The last quarter has seen the
worst advertising budget cuts in the report's nine year history with
all marketing sectors other than online and internet search seeing
budget cuts. "Main media" and the "all other" categories were each
slashed by about 26%, sales promotion was cut by 6% and direct
marketing was down by 5%.
From The Guardian:
http://www.guardian.co.uk,
13/10/2008
IPA:
http://www.ipa.co.uk
Web
ad rates drop over 25%
Challenges in the wider economy spilled onto the
web, pushing ad rates in the US down 27% according to PubMatic. Their
AdPrice Index tracked a big slump in Q3 2008, with prices down 21%
from Q2 and 27% from Q1. All categories showed drops with the
exception of Technology which remained static. The report also found
that ad inventory on small websites is worth over three times that of
large websites, at 61 cents and 18 cents respectively.
PubMatic:
http://pubmatic.com,
23/10/2008
Website AdPrice Averages by Size
Source:
PubMatic
PubMatic:
http://pubmatic.com
Obama campaign uses in-game advertising
Barack Obama's presidential campaign has gone
after the youth vote with a high-profile use of in-game advertising,
writes Brand Republic. The election campaign paid for adverts across
18 video games including "Burnout Paradise", "Guitar Hero" and "Madden
09". Adverts in the racing game "Burnout Paradise" on the Xbox 360
Live network featured realistic billboard ads at the side of the road
for both Barack Obama and VoteForChange.com.
From Brand Republic:
http://www.brandrepublic.com,
14/10/2008
VoteForChange.com:
http://www.voteforchange.com
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Ecommerce |
9 out of 10 British consumers shop online each month
A new study from price comparison site
Shopzilla.co.uk has found that over 11m British consumers buy products
online at least twice each week, writes Brand Republic. The study
further found that 9 out of 10 consumers shop online at least once
each month.
Consumers are increasingly heading online to save money and find
deals. A further study from LinkShare in conjunction with
JupiterResearch found that 56% of consumers plan to reduce their
offline spending against 46% who intend to cut their online spending.
In addition 39% of online consumers plan to spend more time searching
online for the best price. However, according to the latest IMRG
Capgemini e-Retail Sales Index, total growth in online retail is
slowing as consumers spend less overall. September saw monthly online
retail growth of 14.8% on the previous month compared to 73.2% in
September 2007.
In contrast Hitwise has found that searches for second hand products
have risen 22% in the last year, while classified sites are up 47%.
From Brand Republic:
http://www.brandrepublic.com, 21/10/2008
Shopzilla.co.uk:
http://www.shopzilla.co.uk
Monthly change in IMRG Capgemini Index
Source: IMRG
IMRG:
http://www.imrg.org |
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Companies |
Google profits up despite economy
Third quarter revenues at Google were up 31%
year-on-year, beating Wall Street expectations, writes ClickZ.
Revenues for the quarter totalled $5.54bn, up 3% on Q2.
Net income in Q3 was $1.35bn (from $1.25 in Q2). 67% of revenues came
from its own web sites, up 34% from the same point in 2007. 30% of
revenues ($1.68bn) came from partners through the firm's AdSense
network. In total 51% (or $2.85bn) of Q3 revenues came from outside
the US.
Google has also announced two expansions to its AdSense ad system.
Firstly the firm is rolling out contextual ads in its online mapping
service, by serving text ads which are geographically relevant to
individual searches. In addition the firm is making its first move
into the in-game advertising market with the launch of "AdSense for
Games". In-game advertising is set to become increasingly significant
- new figures from comScore show that 25% of internet users play
online games ever week - equivalent to 200m users worldwide.
From ClickZ:
http://www.clickz.com, 16/10/2008
Google AdSense:
http://www.google.com/adsense
Profits at Microsoft beat the forecasts
Profits at Microsoft reached $4.37bn during Q3
from $4.29bn in 2007, writes Netimperative. Turnover rose 9% during
the same period to $15.06bn. However the firm has now warned that it
is unlikely to meet Wall Street predictions during the next quarter
due to economic conditions. Chief Financial Officer, Chris Liddell,
said: "We, like most companies, saw a slowdown at the tail end of the
quarter in particular. We're now taking a more conservative stance on
the balance of the year."
The firm has also revealed its new cloud computing platform dubbed
Windows Azure. The firm is following Amazon and Google in providing
web developers and others a place to store content and applications
without the need for them to have dedicated servers but with enough
capacity and bandwidth to withstand a sudden rush in online demand.
From Netimperative:
http://www.netimperative.com, 27/10/2008
Microsoft Azure:
http://www.microsoft.com/azure
Yahoo! to cut 10% of workforce on the back of disappointing results
Yahoo! has announced that it is to cut 10% of its
staff (over 1,500 people) following poor quarterly results, writes
vnunet. Q3 profits were down 64% to $54.3m, compared to $151.3m in
2007. The firm now hopes to save $400m through the redundancies and
other cost-cutting exercises.
From vnunet:
http://www.vnunet.com, 22/10/2008
Yahoo! UK:
http://uk.yahoo.com
YouTube finds new ways to bring in the money
Two significant moves from YouTube this month
point at how Google plan to effectively monetise the online video
giant. Brand Republic report on a new deal with iTunes and Amazon
which will see YouTube integrate "Click to buy" buttons directly into
videos. Consumers will be able to move directly from a music video,
for example, to a store offering the mp3 track for sale. However, the
initiative is not limited to music purchases - Electronic Arts will be
using the programme to drive sales of its new game 'Spore'. YouTube
will receive a commission for each sale made through the process.
The second move, reported by Reuters, sees the firm offering
full-length TV shows from the CBS archive, including "Star Trek" and
"Beverly Hills 90210". These will be available in the website's new
"Theatre View" format which fills the screen horizontally against a
black background. In a first for YouTube, episodes will include
pre-roll, mid-roll, post-roll and banner advertising as the site
capitalises on the new content. Ads on the first wave of shows will be
exclusively sold by CBS.
The plans follow news of the latest comScore figures which show that
YouTube has overtaken Yahoo! as the second biggest internet search
site in the US after Google.
Reuters:
http://www.reuters.com, 10/10/2008
Brand Republic:
http://www.brandrepublic.com, 08/10/2008
Amazon posts 48% profit rise but remains cautious
Third quarter profits at Amazon were up 48% with
revenues climbing 31%, writes The Financial Times. Net income
was $118m, from $80m in 2007, while revenues reached $4.26bn from
3.26bn in 2007. International sales continued to grow and represented
46% of all revenues. Q4 sales are expected to fall between $6bn and
$7bn with year-on-year quarterly growth ranging from 6% to 23%. The
firm now expects full-year sales of $18.46bn-$19.46bn - down from its
previous estimate of $19.35bn-$20.1bn.
In the UK, the firm has cut its threshold for free delivery from £15
to £5, mirroring moves it made in the US last year.
From The Financial Times:
http://www.ft.com, 23/10/2008
Amazon UK:
http://www.amazon.co.uk
Twitter: rapid growth in an emerging channel
The latest data from the US digital audience
market flags up micro-blogging technology Twitter as being the hottest
of the toolkits in terms of growth, writes CNET. Rising almost 350% in
the last period, Twitter is a great tool for delivering simple
messages about what people are engaged in at that moment. Under the
direction of internet whiz Seth Godin, this "presence" application has
spread among the web heads and early adopter youth markets but now
looks set to find a solid commercial footing.
From CNET:
http://news.cnet.com, 22/10/2008
Twitter:
http://www.twitter.com
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Trends |
China now the world's leading broadband nation
New research from Point Topic shows that China
overtook the US in high-speed and broadband lines in August, writes
ClickZ. China is also adding new broadband subscribers at twice the
rate of the US. In the US, the number of new broadband lines fell from
3.4m in Q4 2007 to 1.1m in Q2 2008. During the same period the number
of new lines added in China rose from 3.5m in Q4 2007 to 5.0m in Q2
this year.
From ClickZ:
http://www.clickz.com, 14/10/2008
Point Topic:
http://point-topic.com/
Broadband Subscribers by Country, Q2 2007-Q2 2008 (M)
Source:
Point Topic
Point Topic:
http://point-topic.com/
Saturation of broadband subscribers per region
Source:
Point Topic
Point Topic:
http://point-topic.com/
Young men in US prefer internet to TV
A new study from Hall and Partners has found that
nearly 75% of 18-34 male internet users spent over 10 hours/week
online during Q2 2008, writes eMarketer. The study, carried out for
Break Media, reported that 69% of those asked said that they could not
live without the internet, against 31% who said the same for
television. Nearly 60% said that they could recall online ads when
they were not online and 47% had purchased a product or service
because of an online advert.
From eMarketer:
http://www.emarketer.com, 09/10/2008
Hall and Partners:
http://www.hallandpartners.com
Time spent online per week according to US male internet users aged
18-34
Source: eMarketer
eMarketer:
http://www.emarketer.com
51%
of UK music downloaders are now legit
The 2008 Digital Music Survey from Entertainment
Media Research has found that for the first time the majority of music
downloaders are using legal means, writes Netimperative. 51% of
consumers now use legal download services, up 9% from 47% in 2007. The
growth in legal downloading is predominantly being driven by older
music fans with 39% of over-45s and 44% of 35-44 year-olds now using
legitimate services (from 28% and 36% respectively). 40% of over-35s
are now buying music downloads at least once a month. The survey also
found that the number of illegal music downloaders in the UK has
dropped by 10%.
From Netimperative:
http://www.netimperative.com, 14/10/2008
Entertainment Media Research:
http://www.entertainmentmediaresearch.com
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Mobile |
Mobile marketing to increase 150% by 2013
A new survey by Vanson Bourne on behalf of 02 has
found that budgets for mobile marketing are expected to rise 150% by
2013, writes Brand Republic. 60% of those polled thought that mobile
marketing was better for close targeting, in particular for financial
services advertising.
From Brand Republic:
http://www.brandrepublic.com, 10/10/2008
Vanson Bourne:
http://www.vansonbourne.com |
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Statistics |
Monthly internet usage statistics for the UK, September 2008
Source: Nielsen/NetRatings Home/Work Panel monthly statistics
Nielsen Online:
http://www.nielsen-online.com
Monthly top ten UK parent companies for September 2008
Source: Nielsen/NetRatings Home/Work Panel monthly statistics
Nielsen Online:
http://www.nielsen-online.com
Top 10 popular websites in the UK, September 2008
This list features the most popular websites based on
UK Internet usage for September 2008, ranked by market share of visits
across all Hitwise industries.
Source: Hitwise Datacentre, September 2008, based on market share of visits
Hitwise:
http://www.hitwise.co.uk/datacenter
Worldwide Active Internet Home Users, August 2008
Source: Nielsen Online, 2008
Nielsen Online:
http://www.nielsen-online.com |
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