Results from an ad Network Study from Collective Media show that interactive agencies and advertisers continue to use and invest in online ad networks despite the current downturn in the economy.
89% intend to work with ad networks in 2009 according to the study. This is an increase of 5% from 2008. Over half of respondents expect to spend up to 15% of their online budgets with ad networks. About another fourth of respondents indicated that their ad network spend will represent up to 30% of online budgets.
“Targeting emerged as the primary area of interest in this year’s findings, relative to how advertisers and agencies are leveraging ad networks,” says Collective Media CEO Joe Apprendi. “Over 60 percent confirmed using demographic, behavioral and contextual targeting. And we saw strong growth over 2008 in those using both site and search retargeting. These findings support the shift Collective Media is seeing among advertisers and agencies toward buying audiences rather than just sites. Based on these survey responses, we expect this trend to continue across 2009.”
Some other interesting findings that Apprendi highlights include:
– Short List of Ad Network Partners: Most agencies and advertisers appear to have established a limited number of trusted ad network partners. Over 70% of respondents surveyed work with only one or two ad networks on an average media plan.
– Differentiation in a Crowded Field: 71% of respondents noted that there are now too many ad networks, up from 62% in 2008. When asked about what best differentiates one from another, the top two responses were inventory quality and targeting, followed by site transparency and level of service. These answers dovetail with respondents who cited transparency, quality and control as top reasons why they remain concerned about working with some ad networks.
– Ad Exchanges Won’t Replace Ad Networks: Although 4.5% more agencies and advertisers said they worked with ad exchanges than those surveyed in the prior year, these respondents remain in the minority. Most respondents (85%) did not work with exchanges, and only 7% believe exchanges will replace ad networks.
– Targeting and Efficiency Matter Most: Efficiency continues to be the number one reason why agencies and advertisers use ad networks (72%), but not at the expense of ad environment and quality. This is demonstrated with 23% of respondents citing inventory quality as the largest differentiator between ad networks, with targeting a close second with 19%.
– Continuing Growth in Brand Advertising: More than 50% of respondents continue to work with ad networks for both their branding and direct marketing plans. At the same time, there was a statistically significant decrease between 2007 to 2009 in the percentage of those using ad networks for only direct marketing plans – which correlates to an increase of marketers using networks strictly for branding purposes.
– Warming to User-Generated Content: User-generated video is still most-cited by respondents when asked on which types of content they will not run online advertising – with 63% of respondents citing ‘Blogs’ and 24% citing ‘Social Media’ overall. However, social media and user-generated content is garnering greater acceptance across the board with all categories improving year-over-year.
“The ability to effectively target audiences, the quality of inventory offered, and the level of transparency and service provided are all critical drivers in the success of an ad network program,” says Brian Mandelbaum, VP, group media director, interactive, Cramer-Krasselt. “While there are hundreds of ad networks in the market today, the trusted partners are those that maintain appropriate focus on the areas that really count.”
Nearly 500 online media decision makers were surveyed. It was fielded by Sterling Research Group between February and March.
