Study Finds Branding to Account For 60 Percent of Digital Spend in 2012

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A recent Vizu-sponsored Digiday survey of 450 advertising executives and marketers found 60 percent of online budgets will be allocated to brand advertising in 2012, an indication spending on online branding may surpass spending on direct response advertising for the first time in the coming year. Top findings from the study:

- 64 percent of marketers plan to increase their online brand advertising budgets in 2012, with 22 percent saying they will increase spending by more than 20 percent.

- In contrast, only 56 percent of marketers plan to increase their online direct response advertising budgets in 2012, with only 15 percent saying they will increase spending by more than 20 percent.

- Additionally, 60 percent of marketers responding indicated they are allocating dollars away from direct response to brand advertising initiatives.

Of the findings and in a statement that is sure to spark debate over what some see as the attempt to fit a square peg in a round hole, Vizu CEO Dan Beltramo said, "These growth predictions are clearly optimistic, but very encouraging nonetheless. There's still more that needs to be done in order to realize those numbers and make online the medium of choice for brand advertisers. I believe that when brand advertisers understand that their online ads can now be measured and optimized using classic offline brand metrics such as awareness and purchase intent, we will see a further growth in their online ad budgets."

But marketers agreed with Mr. Beltramo. When asked what would lead them to increase spending on online brand advertising:

- Nearly 7 in 10 (68 percent) said "Improved clarity around the actual return on brand advertising investment."

- A majority (56 percent) also cited the "Ability to verify my brand advertising created the desired result (e.g. increased awareness of my product)."

- In addition, a majority of respondents (53 percent) indicated the "Ability to use the same metrics to evaluate brand advertising effectiveness online as are used offline."

In what would appear to indicate a desire to return to the metrics simplicities of old, Beltramo said, "These issues are all indicative of a 'metrics morass' in the online medium, which often leads to information overload for brand marketers when trying to determine the efficacy of their advertising. In fact, 34 percent of respondents described themselves as 'drowning in data' when it comes to the online channel."

It seems brands and agencies are in agreement on which metrics they would like to use to determine the effectiveness of online brand advertising:

- In the top spot, 8 in 10 of both agency and brand respondents said: "Brand Lift generated as a result of the advertising."

- A majority (over 50 percent) of both also agree on "Sales generated as a result of the advertising."

- And in a finding that may result in one camp calling the other lazy, 55 percent of respondents said that they'd prefer to use "the exact same metrics used in the offline medium, and a few additional metrics specific to the online medium."

by Steve Hall    Jan-12-12   Click to Comment   
Topic: Research   

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