The next five years will bring more changes to
the advertising business than the previous 50 years. Thats the conclusion of
an IBM study of consumers and advertising experts. Read about the four major
trends the research project sees emerging.
Everybody is well aware that the advertising game has
undergone some pretty radical changes. Online advertising, animation, keywords
and contextual ads, to name a few. But thats just the beginning according to IBM,
which is predicting that the next five years will bring more change for the
advertising industry than we saw during the previous 50 years.
Thats the conclusion of an IBM Institute for
Business Value report titled The end of advertising as we know it.
The studys results are based on the input of 2,400 consumers and 80
advertising experts. It invites us to imagine a bold new frontier in
advertising, a marketing environment where:
Naturally, these conclusions dont bode well for radio,
television and newspaper advertising, though that is assuming their operational
models dont undergo some significant changes, which is already happening.
Traditional media outlets all have websites and are experimenting with new
advertising models and packages. This aside, notions that companies are going
to entirely abandon brand-building ad campaigns entirely in favor of measurable
direct-response campaigns is surely folly.
Still, statistics show there is a major reordering of
spending priorities underway by advertisers, as more and more ad dollars
continue migrating from traditional media venues to online channels. This is
due in part to the high priority advertisers place on reach young people who
havent yet established their buying patterns.
The IBM report believes there are four powerful trends at
work that are reconfiguring the advertising business.
Attention. Consumers are increasingly in control
of how they view, interact with and filter advertising in a multimedia environment.
shook up the television advertising business, as viewers shifted their
attention away from linear TV watching and have adopted tools that allow them
to skip advertisements, as well as rate their favorite ads and easily share
them with friends. This is happening while people spend less time with
tradition media outlets and more time with online media. Those surveyed for the
IBM report say they spent as much time online as they do watching television.
Creativity. Technology has unleashed the
creativity of everyday people. Popularity of user-generated and peer-delivered
content is rising. People arent happy just consuming media; they want to
participate in its creation. New ad revenue-sharing models such as YouTube,
Crackle and Current TV
have allowed amateurs and semiprofessionals to create low-cost advertising
content. IBMs study indicates the trend will continue. Example: User-generated
content sites were the top destination for viewing online video, attracting 39 percent
of survey respondents. Meanwhile, established media players, like publishers
and broadcasters, are taking on traditional agency functions and developing
more of their own creative.
Measurement. Advertisers are demanding
more targeted and measurable advertising campaigns, putting pressure on the
traditional mass-market model created by newspapers, radio and television. Two-thirds
of the advertising experts IBM polled expect results-based formats to account
for 20 percent of ad spending within three years. Those dollars will be shifted
from the currently dominant impression-based model. The exodus from traditional
media ad campaigns began at least a couple of years ago and shows no signs of
Advertising inventories. New advertising
industry players are making ad space that once was proprietary available through
open exchanges. As a result, more than half of the ad professionals polled
expect that within the next five years open platforms will account for 30
percent of the revenue currently flowing to proprietary advertising channels,
such as TV channels and radio stations. Mighty media empires have already been
crippled by the new world order created by the internet. Ad exchanges will
further democratize the business and take the media moguls down yet another
Advertising campaigns have been a key component of corporate
empire building for generations. The advertising agency business itself became
a big industry. Those were simple days by comparison to the fragmentation
taking place today. New technologies have proliferated options for ad creation,
placement, targeting and measurement. The array of diagnostics available for
analyzing online performance is seemingly endless, and technologys rapid
advance means weve just reached the edge of this new landscape.