• Online media’s “favorite child status” (i.e. a long track record of outstripping the growth of every other medium by a wide margin) appears to have diminished over the last few months
• Online advertising by the Financial Services, Retail and Auto industries has shrunk at a dizzying pace over the last six months
• Online display advertising’s share of revenue has plateaued at 20% of total online ad spend in the U.S., and no panacea appears to be on the horizon
• Despite online video’s persistent positive buzz, actual usage is averaging around six minutes per day in the U.S.
• The social media trend is today’s industry darling, but a monetization formula continues to elude the globe’s brightest marketers
But even the most cynical observer has to be swayed by positive developments that define the longer-term opportunities for the online medium and the e-commerce channel:
• Around the globe the online population is looking more and more like the overall population meaning that in a few short years, online access has moved from being a luxury or something cool to an essential, basic requirement
• Packaged goods manufacturers, pharmaceutical companies and telecommunications firms, three of the largest historical spenders on traditional media, are moving online at a pace we haven’t seen before, even as the recession continues to deepen
• The audience growth and engagement quotient of online video is forcing marketers to positively re-assess the value of the online experience
• Adoption of social networking capabilities, by both consumers AND corporations, has crossed the chasm in what appears to be the blink of an eye. In the age of Twitter, feedback barriers have all but disappeared, creating a near friction-free environment for playing back brand experience, campaign reactions or brand events.
• Search continues to be an indispensible tool for all online denizens and opportunities for additional growth continue to emerge. Search across social media networks is the likely next opportunity for search engines
• Access to social networking sites via mobile devices almost tripled during 2008, largely due to rising smartphone penetration and improved network speeds. Increasingly consumers are turning to their phones for a wide range of online content
A Quick Look at Global Usage and Demographics
Exhibit 1 shows a variety of country stats regarding online usage. Americans spend the most time online during the month (a bit more than 2 hours per day), with users in France, Japan and the UK not far behind.
Age-by-Country Demographics
While the demographic-profi le differences of users around the globe aren’t that pronounced, there are some interesting observations (Exhibit 2).
The U.S. online population skews more to the age 50+ than the other countries listed, with the U.K. and Switzerland tied for second and Australia third. Brazil is more skewed to the youth (2-17) demographic, and China (CN in the chart in Exhibit 2) by a signifi cant margin to the 18-34 segment.
Video and Social Media Lead The Way
It is rare to see segments signifi cantly grow from BOTH an audience and an engagement standpoint, but we are seeing exceptional growth over the last couple of years in both video
and social media sites.
While Member Communities have been garnering impressive audience numbers for the last fi ve years, video audiences have been growing at meteoric rates, surpassing e-mail audiences in November 2007 (Exhibit 5). And from a time spent perspective, Member Communities surpassed e-mail for the fi rst time in February 2009. Video has been running neck and neck with search for the last year or so (Exhibit 6).
Cross Media Perspectives
The story within the story of the emerging market for online video is in understanding the interplay between viewing video online and TV viewership. As recent studies show that the amount of time that consumers spend watching TV continues to grow (now 5.5 hours per day), how likely is it for online viewership to take audience away from TV? And how can we compare and contrast the user experience when viewing content on TV vs. online video?
Recent Nielsen TV and Online fusion studies, compares a day of primetime network television audience for each of the major broadcasters with video usage to the Web sites of each of the broadcasters. Based on this analysis, as well as other fusion studies, a few points around cross-media video usage become clear. First, the duplication levels for TV programs and their corresponding online video streams tend to be relatively low, with internet adding approximately 2% additional reach in a given month. Also, there is no evidence that the Internet is cannibalizing TV use. In fact, Nielsen studies have shown that high consumers of TV are also high consumers of the Internet: high-intensity media consumers are high intensity media consumers regardless of media type.
Engagement
Regarding engagement, Nielsen IAG data indicate that the advertising impact of the Internet can add 15 points of lift above TV in terms of brand recall and 18 points of lift in mesage recall. So, not only is the Internet adding incremental reach to a TV media buy, but it is also creating significant additional effectiveness (Exhibit 13).
1. Consumers are looking for deals in a tough economy,
whether they intend to make the purchase online or offl ine
2. With declines in newspaper circulation, a key channel for distribution of printed coupons and advertising, manufacturers and retailers are looking for new ways to move product volume
(Exhibit 31).
The Whole Thing
http://blog.nielsen.com/nielsenwire/wp-content/uploads/2009/04/nielsen-online-global-lanscapefinal1.pdf
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