Online is playing an increasingly important role in the marketing plans of Europe’s top advertisers, to the detriment of other media, a new study says.
Research conducted for the European Interactive Advertising Association (EIAA) found that marketing decision-makers at major client companies – including Coca-Cola, Interbrew, Honda, Kellogg, Mars, McDonald’s and NestlÃ© – predict a substantial increase in their online advertising spend over the next few years, with online representing a much greater proportion of total marketing spend.
The largest rise will be in the automotive sector, where online is predicted to reach 8.7 per cent of total ad spend by 2007, a 123 per cent increase. Packaged goods advertisers predict a 59 per cent increase in the share of online ad spend, while entertainment brand advertisers predict a 28 per cent increase.
The majority of this increased online budget will be funded by cutting spend on television advertising in particular. Automotive advertisers polled claimed that 41 per cent of the planned increase in online spend will come from their TV budget and 20 per cent from the print budget. However, packaged goods brand advertisers plan to fund their increasing online spend from TV (14 per cent) and direct marketing (14 per cent).
Four out of five respondents said the internet is a vital component of their company’s advertising strategy, and more than three-quarters believe internet advertising allows them to reach target groups that are hard to reach through other media.
Nearly nine out of ten of those surveyed said the spread of broadband was making the internet more attractive as a branding medium. Across Europe, marketers continue to spend most on online display ads, but search is becoming more important (search has already overtaken display in terms of spend in the UK).
Deborah Sherry, managing director for Wanadoo UK portal business and a board member of the EIAA, says: “A lot of nay-sayers have been claiming the internet was not on the radar for big brands. This proves them wrong. Everybody we interviewed expects to spend significantly more on online advertising.”
The EIAA is a European trade organisation for sellers of interactive media. Its EIAA Marketers’ Internet Ad Barometer is based on interviews conducted in July and August 2005 by research company Enders Analysis with marketing decision-makers at more than 50 leading European brand advertisers in packaged goods, automotive and entertainment.