Serious about Business

Local Online Advertising In Recessionary Times

An interesting article was just posted by Online Media Daily entitled, Report: Recession Fuels 50% Gain For Local Online Advertising, that speaks to the power of the internet. The article cites data from Borrell Associates that estimates local online advertising will increase to $13.1 Billion fueled by Small and Medium Sized Business spending.

At times like this where we either are or there is great speculation that we are in a recession, how can anyone project growth in advertising, especially among Small and Medium sized businesses? Gordon Borrell, CEO of Borrell Associates says it best, ""What happens in a recession is advertisers are forced to make more economical decisions about how to spend marketing dollars. And the Internet, as they've tested it over the last several years, is cheaper and seems to work."

Internet advertising CPMs, according to Borrell are almost three times lower than Yellow pages print ad CPM. There is a growing exodus of advertising dollars shifting online caused by these starkly lower costs and the measurability that online advertising brings.

And for the Small and Medium sized business that has always had to be smarter than the big brand marketer with their big ad budgets, "recession" may actually mean its a good time for small and medium sized advertisers as well as local publishers.

Online Video Formats: What's the future?

Mark Robertson in his blog titled:  Three Online Video Formats for the Future highlights an article by Melissa Chung in the Industry Standard.   In the article, Melissa talks about three online video formats she thinks could be the future of online video advertising.  They are:

1) Lead generation for video
2) Interactive pre-rolls requiring user input on branding effectiveness
3) Clickable videos that integrate ads with content

She appears to lament the fact that in spite of the positive forecasts for online video advertising growth, the current forms of online video ads seem stuck in the same "retread" notion of pre and post rolls - "rudimentary formats that just piggy-back off other video."

In our work with clients and partners, we see the three things Melissa talks about as closer to reality than she may realize.  Especially for small and mid-size marketers, lead generation and interaction capabilities that drive even more qualified leads is what they are want - not just video.  Online video that drives direct response is just around the corner Melissa, just wait and see.   

A Kelsey Conference Wrap Up

We’ve been here at the Kelsey Group conference on Drilling Down on Local ’08.  The focus of the event is on "catching the wave in local marketing" and specifically charting the transition from offline to online.  Fortunately the conference is right here in Seattle.  Actually two blocks from our office.

Some of the key themes I saw here were:

1) video is the next big thing in online video advertising
2) vertical marketing and the push to online (makes sense given the topic on local)
3) marketing that drives direct response

The show was impressive not just for the broad, strategic thinking that was evident from leaders throughout the directory, interactive media, publishing, and technology side, but also how the focus was really on drilling down to the local market.   Kate Kaye, Senior Editor at Click Z, said it best when she talked about not forgetting that for many SMBs you can't forget the personal level of investment they make.  These are businesses that make decisions at the dinner table that to them are big decisions.  She also went on to say that, for the SMB, results really matter and that direct response matters because at the end of the day it's their money.

We got a chance to demo our product at the conference and focused exactly on the points referenced above - that we need to move beyond the "promise" of video and to the real science of driving action for businesses.

We also got to listen to some great discussion on the state of old media versus new that highlighted the speed of advertising moving from offline to online.  One such session was lead by Peter Krasilovsky, the Program Director for this event, talking with Merrill Brown, Founder and Principal of MMB Media.  For a recap, check out John Cook's Venture Blog entitled: "Old media needs to wake up, or die."

For us, this conference was great, not just for the chance to demo our product, reconnect with lots of smart industry leading people, but also for the validation in our new platform (launched at Kelsey) and the confirmation that our focus on driving action through online video IS the end game goal for small and mid-market advertisers.