Online ad spend still booming

October 16, 2007
by Latitude

Another day, another report confirming that more companies are moving their ad investment online than ever before.

The latest figures come from the IPA’s Q3 Bellwether report, and make for interesting reading:

Online ad spend continued to grow above average in the last quarter, accounting for 6% of overall marketing spend…According to the IPA, one in five companies now allocate 10% or more of total marketing spend budgets to online. A further 40% allocate at least 5%…Sectors like IT, automotive and consumer service saw the biggest growth in their online budgets.

The report also cites claims that 13 per cent of all companies do not use any online marketing. It is hard not to wince just thinking of all the sales slipping through those fingers.

I have banged the drum before about how search is the only form of online marketing that lets you connect with potential customers who are actively looking for the products and services your company provides. More often, they are far down the buying cycle and ready to make a purchase. But the key here is that the search results are not interrupting or intruding on their life, unlike other forms of advertising. Seth Godin puts this more forcefully:

The asset (the only asset, pretty much) that can be built online is permission. The privilege of marketing to people who want to be marketed to. This asset is big enough and valuable enough to build an entire business around (witness Scott Adams and Amazon) and it upsets traditional power structures in just about every industry.

What percentage of your online ad spend is truly invested in search, the only form of web marketing that is built on permission?

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