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May 14, 2008

IBM Predicts Decline in CPM-Based Ad Sales

In a report titled "The End of Advertising as We Know It", IBM has predicted significant changes for online advertising, forecasting "greater disruption for the advertising industry in the next five years than occurred in the previous 50."

Of the 80 "advertising experts" surveyed, more than half expect open advertising exchanges to take 30 percent of current revenues commanded by traditional media in the next five years.

In addition, two thirds expect 20 percent of ad revenue to move away from impression-based sales, in favor of action-based within three years, says the report.

The report goes on to imply that the balance of power in the ad market may move away from the provider, and towards the consumer, with individuals gaining increased control of how and where they view advertising.

As the report states, "Traditional advertising players - broadcasters, distributors and advertising agencies - may get squeezed unless they can successfully implement consumer, business model and business design innovation."

"Consumers are forcing marketers to experiment and make advertising more compelling, or risk being ignored."

IBM also surveyed more than 2,400 consumers, with results suggesting that the public now spend more time at their PCs than they do in front of their TV sets. More than 70 percent of respondents claimed to use the Internet for more than two hours a day, compared with just 48 percent spending the equivalent time watching TV.

Posted by Jack Marshall at 11:48 AM | Permalink | Comments (1) | TrackBack

Euro Agency Mergers: iProspect Enters Germany, MRM Grabs Starsky in Stockholm

There were a couple noteworthy overseas agency acquisitions yesterday. Aegis has acquired Germany-based rmsarcar.com and will merge it with its iProspect search marketing unit. The firm's clients include Scout24, Skyeurope and TUI.com. It'll be rebranded iProspect Germany.

Meanwhile McCann Worldgroup-owned MRM Worldwide swallowed Sweden-based Starsky, merging the smaller firm with its operation in Stockholm. The new entity will be called MRM Starsky Worldwide and have clients including Scandinavian Airlines, Vattenfall, SEB, TeliaSonera and Scania. Starsky founder Anders Nyström becomes deputy managing director of MRM Starsky. Starsky's 18 employees brings the MRM Stockholm staff total to 65.

Posted by Zachary Rodgers at 9:41 AM | Permalink | Comments (0) | TrackBack

Quote of the Day: Ian Schafer on YouTube Buzz Targeting

"Isn’t advertising on the most pre-viral videos on YouTube (and using that as your inventory pool) sucking all of the demographic and contextual targeting out of it? It just feels to me like such a blatant attempt to lure advertisers into the ‘flavor of the minute’ [is] setting the effort up for failure in terms of ad performance.

Here’s the question I’m left asking: Is this going to be an effort that can command and justify higher CPMs? Or is this just another shortcut to associating ads with ‘cool’ content? We all know the ‘coolest’ videos on YouTube are created by non-professionals…"

-Ian Schafer, writing in his blog about YouTub'es new Buzz Targeting feature.

Posted by Zachary Rodgers at 9:33 AM | Permalink | Comments (0) | TrackBack

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