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…

Online content sharing – far from tipping point…

Once in a while, I still mange to across people that think the web is just a bunch of web sites like it was in the 90′s. When I show them effective use of a blog, RSS feed, or social media network of some sort, they gaze in disbelief and wonder where they’ve been the last few years. While these kind of occurrences rarely happen with people I interact with on a daily basis. It’s hard to be unbiased in my line of work and very easy to make false assumptions about what is prevalent out in society – what has and has not been fully adopted in terms of things we preach. This is why I rely so much on statistical analysis and marketing research.

Rather than preaching all the benefits of social media, I often indulge clients with the most recent stats – hard numbers and best practices they can show senior management.

I came across this study the other day, which deals with the issue of social media/content sharing adoption on the Internet. I’m curious to know, where do you fit in? Read below…

“Avenue A/Razorfish, a digital agency owned by Microsoft, surveyed 475 U.S. Internet users across all demographics in July. The study targeted “connected consumers,” those that have broadband access and spend over $200 on e-commerce purchases per year (such consumers represent about half of the overall population).

The study found that some of the most recent advances in content sharing have uneven adoption. For example, just 17 percent said they had shared bookmarks through services like the Yahoo!-owned Delicious. Even more mainstream activities such as photo sharing didn’t resonate: 59 percent said they never used sites like Flickr. A majority had never uploaded a video. About 65 percent said they never used tag clouds.

More mature Web 2.0 technologies have higher adoption: 85 percent used “most e-mailed/most popular stories” links, 60 percent personalized their home pages and nearly the same amount subscribed to RSS feeds. Blogs are regular fare: 61 percent read them on at least a weekly basis.” Read the full article here…

So there you have it, RSS and Blogs have fully hit the mainstream, while tag clouds, video content sharing, and certain aspects of social bookmarking are still far from being widely used. It makes me wonder however, whether terminology can skew the results. For example, I have many friends who have no idea what an RSS feed is, but use them all the time without knowing it (on their Google homepage for example). Others may claim to have never used a blog and yet they write on their Facebook wall everyday. Naturally the same applies for tag clouds and helping to build folksonomies. Are we getting too lost in the terminology? Personally, I think that many people couldn’t care less about the widget name or social implications of the technology they are using; they just do it.

Canada and U.S seriously lagging in average broadband speed

This study was just released this week. Canada and the U.S are way behind the top dogs in terms of average broadband speed. To many individuals, this might come as a surprise and should act as a wake up call.

Consider this excerpt:

“In the first three years of the Bush administration, the United States dropped from 4th to 13th place in global rankings of broadband Internet usage. Today, most U.S. homes can access only “basic” broadband, among the slowest, most expensive, and least reliable in the developed world, and the United States has fallen even further behind in mobile-phone-based Internet access. The lag is arguably the result of the current administration’s failure to make a priority of developing these networks. In fact, the United States is the only industrialized state without an explicit national policy for promoting broadband. ” -ForeignAffairs.org

Here in Canada, (as you can see in the chart above), we’re not much better off at all. The West cannot afford to fall behind like this for much longer. Faster broadband leads not only to benefits for us marketers (i.e. a wider variety of information sharing possibilities and multi sensory media usage to get our messages across), but more importantly, towards a more educated and informed society as a whole.

So what’s stopping us? –>Lack of Fibre Optic cable infrastructure.

How did Japan do it in just 5 years? (note that in 2001, Japan was well behind the U.S and Canada). –>The government got the private sector involved, it gave subsidies and grants to telecom start-ups and most importantly, it saw the benefit and potential of ultra high-speed broadband.

So what do you think? Does the Canadian government dedicate enough resources towards broadband? Should our tax money be used? What would our society be like if everyone had fiber-optic ultra high-speed connections? When will we get there? I’m curious to hear your thoughts…

For more information on the e-Japan strategy and the incredible results, be sure to read this article.