Now that we're a few weeks into the New Year, and everyone is wondering where the online advertising industry will go in what will hopefully be a prosperous and profitable year for everyone, here are five predictions for the online advertising industry in 2010:
Campaign Measurability
For the past few years, many experts have claimed that the industry was on the verge of bringing new, more comprehensive metrics to online advertising. In other words, a way to measure campaigns beyond the impression, click or action—and even tying these three metrics to offline efforts or campaigns run via other media. Think of the Holy Grail for advertisers: being able to know your ROI for your comprehensive suite of campaigns and being able to attribute, or weigh the exact effect from each type of media running concurrently or independently. Some companies (even ours) have been developing their own solutions, and I feel 2010 is the year when we collectively make the most headway towards this goal.
Consolidation
Consolidation was the sexy topic and big prediction from seemingly everyone at the start of 2009, yet it never really happened. A major difference between offline media and the online ad industry is that there are hundreds of players in the online ad ecosystem. It is not as simple anymore as an advertiser or an agency handling offline media buys and then reporting on them. Enter advertising networks (including all the various types of networks), exchanges and the sheer volume of publishers, and you have what some consider a very convoluted ecosystem. I do believe this will be the year that the ecosystem becomes at least a little less muddied, which should benefit advertisers and publishers alike.
Flight to Performance
With every passing report by the IAB/PWC, it becomes more apparent that advertising has skewed over the last few years towards true performance-based campaigns (mainly, CPA & CPC). In 2009, performance-based campaigns made up 58% of all ad spend compared to 38% stemming from CPM. I expect this gap to widen a little more in 2010, especially if the first point above holds true. Remember that CPM pricing was ported over from traditional media over a decade ago, and advertisers are beginning to understand that performance-based campaigns don't necessarily translate into the eschewing brand-building; rather, performance-based campaigns simply mean gaining better insight in the process of building the brand.
Social Media
Think 2009 was a big year for social media? It was. But 2010 will be even bigger. Many advertisers were trying to find their way and understand social media better in 2009; I think this trend will continue with more ad dollars funneling to social outlets, and more importantly, better monetization practices in the process. If advertisers "spend where the traffic is," then this prediction will hold true, as a majority of social networks and social media outlets are growing at an unprecedented rate.
Mobile
Is this finally the year, domestically, that mobile advertising starts to take a bigger piece of the pie? Some recent statistics might suggest so: In 2009, approximately 26% of people accessed the Internet at least once a month on their mobile device (source: eMarketer). By 2013, that is expected to rise to 44%. In 2009, roughly $760 million was spent on mobile marketing. By 2013? That figure is expected to be $3.3 billion.
I do not believe 2010 will be a "breakout" year necessarily within the mobile advertising market; however, it is clear with the recent acquisition activity in the space that major media companies and Web titans believe mobile marketing will play a key role in their futures.
These are the five key online advertising predictions I have for 2010. What are some of yours?
