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Online advertising expected to take-up 18% of marketing budgets within 5 years.

Realistic or too optimistic? What do you think? Should we expect the same in Canada?

“NEW YORK — After years of interactive advertising being dominated by search and display advertising and e-mail programs, new outlets and more sophisticated marketers portend more diverse spending in years to come, according to a new study.

Forrester Research, like nearly all ad-spending forecasts, projects marketers will shift budgets online at a quick pace in the next five years. By 2012, it expects the market will hit $61.3 billion, up from $18.4 billion in 2007. In five years, Forrester expects interactive spending to account for 18% of marketing budgets.

Forrester sees much higher spending growth in newer areas. It expects buying in the “emerging channels” category (in-game advertising, social networks, mobile) to grow from $1 billion to $10.6 billion in 2012, when it will make up 17% of all spending. Online video is set to grow from $471 million in 2007 to $7.2 billion in 2012, accounting for 12% of online marketing spending.” – Brian Morrissey , Brandweek

You can read the full article here…

It’s kind of hard to believe, especially when my province (Ontario) just spent 6 million dollars on completely ineffective 30-second commercial spots for the provincial elections/referendum. When will the government learn to stop letting ad agencies decide which marketing communications activities they should be engaging in? Until the ad agency compensation structure is changed, every ad agency will convince you that you need a TV spot. I mean common! $6 million! for what? Just imagine what that kind of budget could have accomplished if it was put towards a social media strategy.

I am bold enough to say that for 1/100th of that budget given to me personally, I could have given Elections Ontario a significantly better result. Oh well, at least we can celebrate “Family Day” now…

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3 Comments

  1. Hi Mike Kujawski, I attended the talk you gave to the Canada School for the Public Service on April 24. You presented the topic with knowledge and energy. For me, another reminder to get otu there and navigate the conversation Web. A good refresher to the Shel Holtz webinar presenter by Bryan Person that I was able to follow last year.
    I had a chance to go over your slideshow before the 24th discussion, and was really surprised to see in slide 63 that online advertising revenue was listed as $2000-billion in Canada. I didn’t think there was that kind of money (trillions) for advertising in Canada! Since you listed the source, I went to the Internet advertising website and I think your label on the y-axis should read millions. Your point that revenue is increasing was clear, I’m just quibbling over the scale here. http://www.iabcanada.com/newsletters/070430.shtml

    Thanks for the opportunity to comment on the slideshow and keep up the good work.

  2. Thanks Kevin! That’s definitely a typo. I had originally displayed the y-axis in billions then later switched the numbers to millions but forgot to change the label in the process. Please feel free to point out any other errors! Much appreciated.

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