An avalanche of articles in recent months have bemoaned the ineffectiveness of digital advertising. There is huge frustration that the most accountable, measurable, targetable medium in history has so far failed to engage its audience, or to deliver real value to advertisers and brands. Online advertising is often characterised as unappealing, repetitive and intrusive, especially among older users.
But happily, if belatedly, we are seeing signs that digital media’s potential will soon be realised. While the disparity between online spend and the online audience remains – and will take more time to catch up – the latest IAB/PWC report shows UK online ad spend at almost 2bn, including a significant increase in FMCG activity (now 12 percent of all online advertising).
This new-found confidence, by the most visible and prolific brands, will propel online spending yet higher; but even more importantly it will trigger a call for significant, sustainable research and audience measurement. Some commentators expect a wholesale shift to performance-based advertising, away from brand investment. While an inclination to “de-risk” ad spend is a logical conclusion, especially in a challenged economy, it is only part of the answer to satisfying the need for brands to gain share of voice and cut-through in a crowded, impatient market.
Hope in social and video platforms
With a growing proportion (23 percent) of web users’ time spent on social networks, direct response advertising can only be one (albeit important) element of the marketing mix. The vertiginous rise in online video consumption (video advertising grew by 83 percent year-on-year), with its lengthy dwell times and high engagement rates, is a key factor in the new surge of online advertising.
InSkin Media owns and develops highly effective advertising formats, primarily around online video. With average CTRs above three percent, high dwell times around short-form video, more than 100 blue-chip brand advertisers, and 80 of the UK’s leading publishers and broadcasters, have started using our products this year.
The ubiquity of broadband, versatility of mobile devices, and the undimmed public appetite for information and entertainment, are the springboard for driving new levels of effectiveness in digital advertising. Research and targeting are central to delivering that goal.
To date, research has been sketchy and inconsistent: InSkin Media has produced studies in partnership with both Sky and Metrix Labs, but the industry requires far greater investment in its future: solid reference points for the agencies. In terms of effective measurement tools, the industry has united behind UKOM (Nielsen) to provide the depth and breadth of audience analysis on which brand investment depends. This standard will be helpfully supplemented by the respective offerings of Comscore and ABCe.
However, the greatest jump in effectiveness will be achieved through improved targeting. From my first-hand experience of AOL Advertising, and of the controversy around Phorm in the UK, I am acutely aware of the need for education, transparency and clear communication around targeting. Giving relevant timely messaging to interested, active users should bring increased value to advertisers, publishers and users.
The first wave of behavioural targeting, spearheaded by companies such as Audience Science, Rubicon Project and Grapeshot, has proved the potential but not yet delivered the industry-changing results which are surely now within reach. Those results, and a positive shift in the perception about the effectiveness of digital advertising, are now in sight.
Hugo Drayton is CEO of InSkin Media. email@example.com