Online Advertising Strategies in Need of Revamp
Enterprises, advertising technology vendors and digital marketing services providers need to urgently redefine their online advertising strategies as advertising consumption patterns shift online and toward mobile, according to a report from analyst firm Ovum.
The report noted leading enterprise marketing technology providers such as Oracle and IBM have been slow to embrace the online advertising market, allowing vendors such as Rocket Fuel, MediaMath and OpenX to grow extremely quickly from small players into powerful and influential online advertising technology vendors.
With these vendors now entering their next growth stage, transitioning from point solutions into enterprise advertising platforms, the wider online advertising industry is in a "2.0" paradigm, with personalized real-time bidding technologies replacing traditional mass-media static "banners” or “skyscrapers."
Meanwhile, global management consultancies and systems integrators are looking to exploit the burgeoning services market that surrounds online advertising technologies, in particular the creation and management of the big data that is integral to online advertising processes.
"The online advertising industry is full of supply chain complexities, acronyms and buzzwords that have made it difficult for CMOs and marketing executives to fully comprehend," Gerry Brown, senior analyst in Ovum’s customer engagement team and author of the report, said in a statement. "They need to break down this complex industry into easy-to-consume, bite-sized chunks in order to make informed, educated and strategic decisions about online advertising technology investments and their choice of external services partners."
Overall, the report reviews the state of maturity of the online advertising industry, the early adopter industry sectors, the key vendors and service providers, and forecasts the future technology developments and enterprise adoption trends.
Ovum discusses in particular how vendors should address the key enterprise concerns of ad viewability, ad performance measurement and ad attribution within the context of a hostile regulatory environment and enterprise big data strategies.
"Enterprises need to embrace the online advertising market, which is becoming a key promotional channel to market for enterprise marketers. However, enterprises’ market participation needs to be managed with caution," Brown noted. "Fraud and data security in particular are issues that plague the online advertising industry. IT departments should work alongside marketers to ensure that robust IT best practices are deployed."
About 40 percent of small and midsize business (SMB) owners who spend at least $1,000 annually on advertising indicate they will invest more in advertising in 2014, and nearly 21 percent of SMBs said they will allocate more funds to direct mail, according to a report from Ad-ology Research.
Other forms of advertising expected to see the greatest increases in 2014 include display banner ads, online video, mobile advertising and suburban and community newspapers.