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Online advertising revenues 'to soar'
Global online advertising revenues will reach $81.1 billion (£41.3 billion) by 2011, researchers suggest.The new User Revolution report from Piper Jaffray & Co argues that the five years until 2011 will see a compound annual growth rate of 21 per cent, as online marketing becomes increasingly important to businesses of all sizes.
"The historically passive consumer is changing rapidly, not only becoming more informed and confident about purchase decisions, but also increasingly taking control of the consumption of information and content that used to be distributed by networks, studios, publishers and retailers," said Safa Rashtchy, senior research analyst at Piper Jaffray.
"We believe this will cause a significant rise in prominence of the internet as a major content consumption and marketing medium."
'Communitainment' will also become increasingly important in the years ahead, according to the authors of the report. Community, communication and entertainment have now "collided", it is claimed, and the resulting amalgam is stealing time from other online activities.
The report also highlights the impact of media fragmentation, which is forcing advertisers to buy inventory from all types of media to reach the desired audience. Crucially, however, advertisers will begin to move more money from traditional media to online, with video advertising particularly important.
"Like many major social trends, the changes will not happen overnight and we expect the User Revolution, which has just begun, to last several years before the new regime is fully established and the old statues have all been toppled over," Mr Rashtchy added.
Online advertising will clearly play a major part in this revolution and businesses are advised to make the most of the emerging trends.
Google News posted on 26 February 2007
