Display Ads Still More Important Than Online Video

Advertising through online video may be the hot topic these days, but that doesn’t mean that more traditional means of reaching consumers like display ads are dying off. In fact, recent numbers from Datran Media indicate that advertisers prioritize display ads over online video by more than 2 to 1.

When advertisers were asked to name the most important advertising tactics that they planned to use in 2007, 36.2% responded with display ads, while 14.9% responded with online video. E-mail marketing took the cake with an 83.2% response rate, while search marketing was second with a 61.7% response rate.

Display ads were third, followed by ad networks (31.9%), contextual targeting (27.7%), traditional direct (27.7%), print advertising (19.1%), online video, mobile marketing (10.6%), and RSS (4.3%).

This is further supported by recent numbers released by TNS Media Intelligence, which indicate that big companies were spending big bucks on display ads in 2006. Vonage topped the list with $185.7 million spent on the medium, while AT&T followed with $166.4 million, and Dell was third with $136.9 million spent on display ads.

Walt Disney, General Motors, Experian Group, Verizon, Apollo Group, IAC/Interactive Corp., and TD Ameritrade rounded out the top 10.

Paid search still demands the biggest portion of online ad budgets, and will do so for the foreseeable future. Display ads and classifieds are expected to remain relatively steady, while rich media/video is expected to see steady increases.

DoubleClick numbers lend support to the strength that online video should continue to see, and is seeing now. Click-through rates (CTR) for ads in online videos are pegged at anywhere between 0.4 to 0.74%, depending on the format.

These rates seem insignificant, but they are far more encouraging than the 0.1% CTR that ordinary GIF and JPG image ads receive.

Standard online video ads ("in-page format that does not expand when clicked") received CTR of 0.40% in 2006, while expandable online video ads ("in-page format that expands to a larger display window when clicked") received CTR of 0.47%, and in-stream online video ads ("video ads that are part of streaming video") received CTR of 0.74% in 2006.

Interaction rates for online video ads jumped from 7% in the first quarter of 2005 to 18% in the third quarter of 2006, according to online ad solutions company EyeBlaster.

While early indications seem to be very encouraging for marketers hopping onto the online video bandwagon, traditional forms of advertising online are not going to lose significant ground anytime soon.

Sources:

http://www.emarketer.com/Article.aspx?1004690

http://www.emarketer.com/Article.aspx?1004696