Within the whirlwind of negative news regarding the economy and the advertising outlook, I found a significant, welcome trend in the IAB’s recent revenue report covering the first half of this year. I’m scratching my head trying to understand why more hasn’t been made of this, because it portends hugely positive things for the online space.

The IAB recently announced a 15.2% year-over-year growth rate for Internet advertising for the first half of 2008. When you dissect the 15.2% number, some interesting details emerge. Out of nine industries tracked, only four have grown from last year. In and of itself, this finding would fall in line with all of the other negative things we’re hearing about the prospects for advertising.

However, look at the list of the four growth industries: CPG, Auto, Telco and Computing. Do you see what I see? These industries have consistently been the big overall ad spenders for a long, long time. Companies within these four industries make up 42 of the Top 100 national advertisers, and 52% of the advertising spend. And note that the two largest ad-spending industries, i.e. CPG and Auto, have been largely absent from the digital world until very recently. When you combine these four industries, their online ad spending grew 29.8% on a year-over-year basis from the first half of 2007.

The implications of all this? If the big ad spending industries continue to embrace the online medium more aggressively, chances are good that new, significant waves of growth are in the works for the interactive space. In his recent forecast, Jack Myers makes this interesting statement: “We are in the dead center of a two-decade industry transformation that began with the launch of Google in 1998. It will be 2012 before the industry of the future - the 21^st Century model of the media and advertising industry - will begin to prosper.” While new technology trends typically get all the buzz, I have this sneaking suspicion that some of the leading advertisers that make up big ad-spending industries may be out-innovating all of us, and we will see new online market mojo well before 2012.

Tags: auto, computing, cpg, IAB, online advertising, telco

The recent cataclysmic events in financial markets have jolted many of us into a “back to basics” mentality. Basics such as “what goes up must come down.” Basics such as “live within your means.”

Over the weekend, my colleague Dave Martin and I reviewed a 100 year trend of price/earnings ratios for the S&P 500. For the last 18 years or so, the average has driven far north of the long term average of 15, and a “back to basics” mentality would have indicated that sooner or later it would come back down to the average, and probably overshoot it on the way down. Lo and behold: an article in last Thursday’s Wall Street Journal reported that the P/E ratio went below 11.

It’s interesting to note that the P/E ratio “bubble” over the last 15 years pretty much coincides with the introduction, growth and mainstreaming of the Internet and interactive media. And the dramatic correction in financial markets has made me wonder: what kind of correction is due for online media and market researchers? I suggest this should happen because, as with the financial markets, many have gotten carried away with an exhilaration regarding all things interactive, and this exhilaration has caused many to overlook tried and true research approaches that have withstood the test of time. After all, how often have we heard something like this: “The Internet is different…the research that has worked historically for other media isn’t relevant to the Internet”?

The Media Rating Council (MRC) has looked closely at this, and here is what they have to say: “Overall we’re ready to consider some compromises in strict probability sampling in the name of larger Internet samples for currency measurement. But we will not let certain narrow technical issues to allow us to throw out the quality ‘baby’ with the probability ‘bathwater.’” Here are six essential research anchors according to the MRC:

1) Knowledge of the universe

2) Coverage of that universe (e.g. minimizing totally excluded populations)

3) Efforts to minimize non-response bias in general (e.g. optimizing cooperation)

4) Understanding and minimizing differential cooperation (to achieve proportional samples)

5) Consistency of procedures over time (so that results are replicable)

6) Sample sizes

So with this in mind, let’s ask: “Which financial institutions are positioned to survive the current meltdown?” The answer: those that clung to portfolio quality and didn’t let go. The great financial sages foretold that when turning away from quality, one pays for it sooner or later. Time will tell, but I’ll bet the same lesson will hold true in the online media and market research world. What do you think?

Tags: MRC, research, standards

What’s happening in the world’s largest Internet market? Last week we announced our JV in China - CR-Nielsen - the first company authorized to support the delivery of standardized Internet measurement services in China. The top sites are dominated by Chinese brands, with global brands like Google and Yahoo! present with their local sites. Overall, the numbers are quite significant. The top site, Baidu, was visited by slightly more than 171 million unique browsers during a single week. And while there is no exact comparison between unique browsers and unique visitors - historically our standard audience measurement metric - 171 million of anything during a single week is a big number! So while we are just starting to scratch the surface in this growing market, we know more today than we did yesterday - and we look forward to delivering insights into this important market.

Tags: baidu, china, cr-nielsen

We’re at a strange period in the brief history of online advertising. After 5 years of 30% YOY growth for online advertising, the dramatic economic slowdown will put a damper on all forms of advertising, including online. While online will likely grow faster than all other forms of advertising in 2008, the growth rate could be in the single digits for the first time in 5 years, and who knows what to expect for next year.

Despite the continuing growth in online’s share of overall advertising, many in our industry continue to be confounded that the share hasn’t grown even more than it has. One of the most prevalent arguments is that it’s taken too long for online standards to become established, buying campaigns across many sites continues to pose challenges, and it is still much easier to buy advertising on TV, radio and print than it is online.

Another concern is that consumers ignore online ads, or the ads themselves lack any emotional connection…this could be caused by either poor creative, poor copy - or a poorly planned media buy. But we think another culprit is online ad clutter - too many ads competing for the consumer’s attention. My colleague Jon Gibs just conducted a Webinar on this topic and rolled out our new custom clutter metric - you can download the presentation from our download library later today. I’m interested to know what you think - is this issue impacting your advertising effectiveness or ability to position your site?

Tags: ad clutter, clutter metric, online advertising

The current financial crisis has consumers taking to the Internet. They’re checking brokerage and 401(k) accounts, with traffic to the Online Trading category up 30 percent for the week ending September 21 as compared to average weekly category traffic measured over the previous seven weeks. They’re also talking. OK, I’ll go out on a limb: they’re venting. A Blogpulse analysis of terms including “401k,” “bailout” and “wall street” showed increased discussion, with “bailout” included in nearly 2 percent of all blog posts on September 29^th. Check out today’s media alert for full details.

Tags: 401k, bailout, wall street