Over the past two decades, advertisers have gradually shifted their budgets away from traditional media (e.g. TV, newspapers and magazines) towards online ads. The rise of the smartphone has only accelerated this shift, as smartphones have fundamentally changed the way that people consume content. Ad dollars have always followed eyeballs and thus it doesn’t come as a surprise that mobile ad spending is currently growing a breathtaking rate.
One consequence of the shift towards online advertising is the fact that fewer companies command a larger share of advertising dollars spent. In fact, two companies, you may know them by the names of Google and Facebook, are so dominant in the online world that they account for more than 60 percent of global online ad revenues. According to advertising research company WARC that means the market leaders in search and social media will pocket 1 in 4 dollars spent on media advertising worldwide this year.
Creating content is the top goal for marketing pros around the world. According to figures compiled by communications and marketing agency Cognito, 61 percent of the 165 marketing leaders they interviewed for a survey named creating content as the area where more of their marketing budget will be invested in 2018. This makes sense, as in the previous report only 18 percent of respondents were happy with the content they could market.
Investor relations (71 percent) and public affairs (69 percent) featured in the two top positions of areas where investment will remain the same. The top loser according to the survey will be traditional advertising, with 40 percent of marketing leaders wanting to invest less.
These developments could have negative implications for traditional media outlets, as the volume of content published or disseminated by company marketers could more strongly compete with traditional publishing content. Diverting dollars from traditional advertising could also negatively affect heritage media ad revenue. This chart was first published by our partner FIPP.
At first glance, tough love seems to be the way forward for online media to get users to turn off their ad blockers. 58 percent of respondents in a Reuters Institute for the Study of Journalism (RISJ) poll said that they turned off their ad-blocker, at least temporarily, if there was no other way to view the website or content. But explaining to users that the ad money is needed to fund the website can get publishers places too. 26 percent of users said they switched off the blocker when notified the website depended on the ad funds.
The good news is that there are ways to get users to comply with the rules of indirect funding. However, this doesn’t mean that users will start loving ads because they were in some way coerced (or kindly asked) to turn off their ad blockers. Then again, 43 percent of respondents said they switched off their blockers for particular news sites, meaning that news media could profit from investing in a relationship with users. It seems, some users surf with an ad-shield by default, but are willing to let down their guard if the targeted website is trusted.
This chart was first published by our partner website FIPP.