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Sunday, May 01, 2005

The Shifting Patterns In Internet Advertising

(Via Oreilly Radar).Blogspot , now receives a larger audience of unique users across its million-plus blogs collectively than does the NYTimes.com, according to Alexa. Doubleclick has released this report The decade in online advertising. The report says, comScore Networks, which reports that in February 2005, NYTimes.com had a unique U.S. audience of 5.7 million compared to Blogspot’s 7.6 million. Mainstream advertisers including Absolut, American Express, Audi, British Airways, Fox Searchlight Films, HP, Jose Cuervo, Nike, Sony, Palm, Paramount Pictures, Subaru, Suzuki, Volvo, WHotels and Warner Bros. are among the advertisers running ads on these and other blogs.

The explosion of user-generated content is changing the web media landscape. While there have always been large numbers of sites online, traditionally the largest have dominated in terms of audience and advertising dollars. There are indications that the balance may be shifting with the fast-growing popularity of blogs, social networks and similar below-the-radar content. According to comScore analysis prepared for DoubleClick, Yahoo! alone generated 12% of all page views among the top 16,000 domains in the U.S. market in February 2005. Together, the top 100 domains generated 58% of the total page views in the market. The bottom 15,500 sites collectively generated 25% of those page views That last group may or may not sound like a lot. Google is one of the largest players in the online ad world. It does so in part by accessing those many smaller sites, connecting more than 150,000 mostly small advertisers (though many large ones too) with hundreds of thousands of small sites and blogs through its contextually targeted AdSense program (in addition to its AdWords search-targeted program). There are, in any event, many more than the 16,000 domains online comScore included in its analysis above. Alexa, for example, tracks more than 2 million different domains. So the “long tail” of page views generated by smaller sites may be very long indeed. The significance of this for advertisers is it represents a possible ad
inventory opportunity particularly as inventory tightens among top sites.

Significantly, the report notes that 2004 was the first year to pass the bubble peak of 2000 in online ad revenue. And while the 2000 ad splurge was driven by venture-backed dot-coms, the 2004 numbers are driven by traditional advertisers. 30% of all internet advertising in 2004 was done by Fortune 500 companies. But the most significant fact called out by the report is that the growth in interest in advertising is coming at a point when page view growth has slowed dramatically, resulting in a seller's market for the first time.
Some interesting list of key metrics that advertisers are using to justify their internet ad spending:
post-click conversions
• cost per conversion
• unique reach of ads delivered
• average frequency of exposures
• frequency-to-conversion ratio
• ad exposure time (rich media)
• ad interaction rate (rich media)
• brand impact lift vs. control ad (including ad recall, brand awareness, message association, brand favorability, purchase intent)
• view-through rate (i.e., delayed visits to advertiser’s site without a direct ad click-through)
• share of voice
• web page eye tracking
• offline sales lift
• cross-media-mix econometric modeling

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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
"All views expressed are my personal views are not related in any way to my employer"