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European confidence in online marketing is strong

European confidence in online marketing is strong

According to new research published this week by MSN, in association with the Interactive Advertising Bureau (IAB), 88 per cent of brand managers and marketing directors who are responsible for pan-European campaigns will increase or maintain their online marketing budgets over the coming six months.

Furthermore, seven out of 10 marketing directors and six out of 10 media buyers/ad agencies said that a better understanding of the value of online advertising was the key driver in encouraging them to spend more.

These results paint a picture of renewed confidence among sales staff at major sites such as MSN, AOL and Yahoo! and the agencies that buy space on them. It seems that the efforts of the Interactive Advertising Bureau and the big online players to promote the medium are starting to pay off.

In certain sectors online ads are now an integral part of any big campaign, rather than just an afterthought.

Most car launches, for example, now have a large online branding element because manufacturers realise that most people go to the web to research their new car. And music, in particular, is tipped for further growth with the growing popularity of online download services.

The most powerful benefit of online appears to lie in its interactivity and targeting ability, with 59 per cent of marketing directors and brand managers responsible for online campaigns across Europe citing these factors as the main reasons to use digital marketing.

Additionally, online’s cost effectiveness (53 per cent), extensive reach (50per cent), ability to get close to customers (56per cent) and adaptability (47per cent) are seen as the winning attributes of the medium.

The challenge now for the likes of MSN and Yahoo! is to continue to convince big advertisers that the Internet can be used as a so-called branding medium as well as a direct response one - in other words, to create the big branding statements the like of which appear on cinema, TV and billboard ads.

Danny Meadows-Klue, Chairman and Chief Executive at the IAB, says: “We’ve been researching the branding power of the web since the mid-nineties and we’ve proven it works. As more of the big brands are realising the benefits of online brand campaigns in achieving brand standout and others are starting to follow, it’s no surprise that smart marketers are shifting their budgets towards online brand campaigns”.

Chris Ward, director of MSN UK says: "I agree that there's still a long way to go, but we've increased one whole percentage point in a year and we're now hot on the heels of radio. That shows how much potential there is for the business."

"The industry has risen to where it is today on the back of direct-response advertising. We need to consolidate on that, there's still a lot more to do there. But if we can do the same on the brand side as we've done on direct response, then that increases the cake massively," he adds.

To this end, MSN has reorganised its home page to cut down on clutter and provide one premium-advertising slot.

For Ward, the challenge is for the big portals to stop fighting among themselves for market share and to start working together to promote the benefits of the Internet as an advertising medium.

"There's still scepticism among some brand managers. They need hard evidence that they can show their boss in the lift. It's important not only for MSN but for the industry as a whole to provide that evidence."

Overall, though, the future looks bright, says Ward. "If anything, it's got a momentum now. There have been enough examples of big brands with great creative work for it to demonstrably work for them.

The word has got out. There's a steamroller effect. We need to look in the medium term at online being an 8-10 per cent medium. If you look how far we've come in just five to six years, it's eminently achievable."

Sources: MSN, The Guardian, UKFast


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