Online spending always seems to be on the up every time the IAB releases its quarterly year-on-year ad revenue reports and figures released for Q2 are no exception with total online advertising spend in Q2 up 19.46 percent to $84.15 million.
In fact, IABNZ chair and general manager of MSN New Zealand Liz Fraser is feeling so optimistic, she’s already predicting 2011 will experience an overall growth of approximately 20 percent.
Year-on-year growth in Q2 wasn’t discriminatory with all channels experiencing surges to varying degrees. While growth in classifieds was up by 4 percent, display advertising notched it up slightly more with an increase of 17.3 percent. But it was search and directories that experienced the most significant growth, up 34.58 percent.
As well as experiencing the largest growth, search and directories is also the channel leader with a 41 percent share of total online ad dollars. In Q1 it had a 38 percent share of the ad dollar pie. Display has increased from 29 percent to 31 percent meanwhile classifieds was the only one to experience a decrease, dropping from a 33 percent share to 28 percent.
“With quarter-on-quarter growth of 22.94 percent, the online advertising industry is picking up pace, allowing advertisers using this channel greater opportunities for exposure. Advertisers continue to increase their focus on online technologies and re-aligning business strategies towards more innovative ways of advertising online,” says Chris Perree, PwC partner.
Perree adds that international events like the Rugby World Cup provide give advertisers the chance to engage with a more diverse group of viewers through multiple channels.
And don’t forget the impact mobile technology is having either.
“Mobile technology as an advertising channel has captured the attention of advertisers. People accessing the internet and social media through mobile devices could over time exceed the usual desktop access. It will be interesting to see how local advertisers capture the audience especially with the influx of overseas smartphone users attending the Rugby World Cup. Mobile social networking enables users to share, compare and contrast their experiences, views, entertainment, travel, fine dining, shopping and much more,” says Perree.
And it seems consumers are developing quite the penchant for email and online video advertising, with both experiencing some impressive growth in the display advertising domain. Email spend rose 47 percent quarter-on-quarter while video increased by 41 percent. This is the second quarter the survey has separated out email and video spend from the total display figure.
The top display category in Q2 this year was government departments, services and communities with 15.14 percent. Investment, finance and banking followed with 12.92 percent. Leisure, entertainment and media (10.70 percent) and travel and accommodation (10.53 percent) round off the display categories.
“Online display is going from strength to strength, both globally and locally. The significant increase of brand activity we are experiencing in New Zealand is a pointer to a maturing market that is beginning to see beyond the click through rate as a measure of success,” says APN online sales Director Donna O’Keeffe. “In the last quarter we saw a significant increase in the amount of rich media executions, particularly homepage takeovers and video formats, and a steep rise in demand for bespoke solutions and content integration.”
O’Keeffe says the emergence of new categories like Leisure & Entertainment are offering new opportunities for publishers to develop new environments and products to meet the needs of these brands.
Yahoo!New Zealand general manager and IABNZ vice chair Laura Maxwell-Hansen says two of the biggest drivers in the growth of online display advertising are an increased sophistication of display ad-servers to find consumers who show interest, and intent and advertisers realising the value of connecting with New Zealand audiences on New Zealand publications.
“Finding the cheapest possible eyeball isn’t the objective of every advertiser and every campaign, so smart marketers are also considering audience mind-set, affinity with the publisher brand and psychographic audience measurements when choosing a publisher on which to achieve their objectives,” she says.
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