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Monday - September 11, 2000
Dot Com Advertisers Outnumber Traditional
Advertisers Online
Although traditional companies are paying more attention
to online advertising, dot com advertisers outnumber traditional
advertisers online two to one, according to a new report
released today by AdRelevance.
Key findings from the AdRelevance Special Report,
which analyzes the Top 200 online advertisers in the second
quarter of this year and compares dot com companies to traditional
businesses, include:
- The percentage of dot com advertisers
in the Top 200 rankings increased from 54 percent in
July 1999 to 68 percent in June 2000.
- Dot com companies are committing a greater
percentage of online ad impressions: 108 dot coms committed
64 percent of the Top 200's ad impressions in July 1999;
while, in June 2000, 138 dot coms committed 75 percent
of the impressions.
- While dot com advertisers outnumber traditional
advertisers when looking at all industries combined,
the story is not quite the same when the trend is examined
across individual industries: Web media, retail and business-to-business
industries are dominated by dot com advertisers, with
85 percent, 74 percent and 61 percent of the Top 200
online advertisers being dot coms, respectively. Traditional
advertisers, however, populate travel (76 percent), software
(84 percent), hardware and electronics (97 percent) and
consumer goods (97 percent) industries.
"With the market's recent performance
and the increased pressure for dot coms to turn profits,
it's interesting to see that the clear majority of the AdRelevance
Top 200 Online Advertisers are dot com companies. According
to the latest AdRelevance data, dot com advertisers account
for 68 percent of companies and 77 percent of ad impressions
among the Top 200 Online Advertisers," said Charlie
Buchwalter, vice president of media research for the AdRelevance
division of Media Metrix. "When compared to traditional
advertisers, the average dot com appears to be spending more
aggressively, typically even outspending traditional advertisers."
While dot com advertisers might not account
for the majority of companies advertising online in the top
rankings by industry, the few companies that are in the Top
200 dominate ad spending in some instances. For example,
although only 32 of the Top 200 software advertisers are
dot coms, they account for 86 percent of all impressions
within the industry. Similarly, 48 of the Top 200 travel
companies are dot coms and account for 80 percent of all
travel advertising impressions placed by the Top 200 travel
advertisers.
"Despite the overall dominance of dot
com advertisers, traditional advertisers have managed to
stake a claim in some industries" Buchwalter said. "There's
no doubt in my mind that as traditional businesses become
more comfortable with online advertising, they will begin
to spend more of their budgets on the Internet - in fact
that's probably the next wave we'll see hit the online ad
industry. But, until that day comes, dot coms are in the
driver's seat."
Majority of Online Ad Banners Have Short Life Spans
The majority of all online ad banners have short life
spans, running on average three weeks or less, according
to a new report released today by AdRelevance. With few
advertisers running large online campaigns, an overwhelming
majority of advertisers have less than a 0.01 percent share
of all online advertising impressions.
Key findings from the latest AdRelevance Intelligence
Report, which analyzes standard 468x60 banner ad campaigns
on the top 500 Web sites between July 1999 and June 2000,
include:
- Although most banner ads run for three
or fewer weeks, the average banner runs for five and
a half weeks.
- The automotive industry schedules online
ads to run the longest, an average of 7.8 weeks. This
is almost twice as long as the average banner duration
for a hardware and electronics ad, which typically lasts
4.1 weeks.
- The consumer goods industry embraces
the most targeted ad approaches, with only 40 percent
of online impressions appearing on broad reach sites
like portals, search engines and community destinations.
At the other end of the spectrum, Web media, financial
services and travel advertisers appear to be targeting
the least, running an overwhelming majority of ad impressions
on broad reach sites.
- While the average campaign in the second
quarter weighed in at 7,265,000 impressions, more than
half of all advertisers ran campaigns with less than
44,000 impressions. A campaign this small would only
garner a 0.0003 percent share of voice on a major portal
like Yahoo!.
"While most advertisers are running relatively
short campaigns, shorter campaigns are not necessarily better
campaigns," said Charlie Buchwalter, vice president
of media research for the AdRelevance division of Media Metrix. "Although
shorter campaigns may concentrate banner impressions, thereby
increasing the share of voice and share of market for an
advertiser, only longer campaigns can bring about a change
in consumer attitudes and behavior. The latest AdRelevance
findings suggest that automotive, financial services and
travel advertisers are out to change behavior because they
are running banners the longest, when compared to other industries."
The AdRelevance Intelligence Report also analyzes
ad impression distribution strategies for campaigns running
four, eight and 12 weeks - revealing that banner impressions,
on average, are heavier in the beginning of four and 12 week
campaigns. On the other hand, campaigns running eight weeks
tend to feature higher impression levels in the middle. Impressions
for the average banner in an eight week campaign peaked in
the fifth week.
"There is no golden rule when it comes
to campaign continuity, but it appears that advertisers are
adopting two weighting approaches - either front-loading
for shorter campaigns or pulsing for longer campaigns," Buchwalter
said. "The conclusions from this AdRelevance Intelligence
Report support the fact that the online advertising market
is still in its infancy, and has a way to go before analysts
can accurately determine what constitutes an effective and
successful online ad campaign. We'll know things are changing
when more companies commit to larger, longer and more targeted
online campaigns."
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2000 News Archive
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