Industry related news item:
webweek.com
January 19, 1998
Still Seeking Credibility As an Ad Medium
By Nelson Wang
The year 1998 will be a critical one for online advertising, in terms of establishing itself as an ad medium comparable to traditional media and one that can be purchased efficiently, experts and observers said.
Financial services and sellers of consumer goods picked up some of the slack last year in terms of ad spending, but it remains clear that some of the big advertisers in the traditional world are going to have to increase their online ad budgets in 1998 for the industry to reach the close to $2 billion in spending that some analysts are predicting.
"We're not on par yet with the traditional media [in terms of research], and so agencies are having trouble justifying spending on online [advertising]," said Richy Glassberg, senior vice president and general manager of Turner Interactive and a director of the Internet Advertising Bureau. Glassberg, who has a background in television sales, said that while the metrics for Web advertising don't necessarily have to be the same as in traditional media because the Internet is a new medium, they do need to be comparable and relevant.
To this end, ratings firms Media Metrix Inc., Relevant Knowledge, Net
Ratings, and Nielsen Media Research will all be releasing results this
year, vying to establish some definitive metrics for comparing the
audiences of various sites.
Glassberg added he's optimistic that useful measurements will evolve
soon, and that 1998 will see some big advertisers in traditional media
taking the lead in online ad spending and forcing their competitors to
follow. "It's just the normal growing pains of any new medium," he said.
In the ad sales and management space, most analysts expect to see
continued consolidation among ad networks and software companies
as the size and breadth of service and offerings become a factor in
attracting clients. In the last six weeks alone, Zulu-Tek purchased
Softbank Interactive Marketing, and a merger was announced that will
unite Petry Interactive, Katz Millennium, and Interactive Imaginations
Inc.
"If 1997 was the Web winter for some content companies, then 1998
looks like it's going to the Web winter for tools and software
companies," said Evan Neufeld, a senior analyst with Jupiter
Communications Neufeld said advertisers are becoming increasingly
frustrated having to go to different companies for the auditing, selling, measuring, and reporting of ads, and predicted that this frustration will lead to more of the mergers and partnerships seen in late 1997.
Neufeld expects to see some tough competition in the ad-serving
software space, now dominated by NetGravity, Accipiter, and
AdKnowledge (formed from the merger of ClickWise and FocaLink),
as the number of sites large and profitable enough to do ad serving
in-house--rather than outsourcing the task--remains small.
As for multimedia and Java-based ads, more impressive and effective
offerings will no doubt emerge, but some sites will continue to resist
supporting them for fear of disrupting their users' experiences.
One technological development many observers see for 1998 is the
increased use of e-mail- based ads as dynamic HTML-enabled e-mail
programs become more common.
"You may see a lot of ads shifting from the Web to e-mail in 1998--it's truly a one-to-one marketing solution," said Michael Tchong, the editor of Iconocast, an online marketing newsletter.
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Keywords: advertising
Date: 19980119 |
