The amount U.S. companies spend on online advertising is set to double in four years, Information Week reports today. It's no secret that more and more big brands are creating a presence for themselves online, but what exactly are all those advertising dollars buying? According to a study reported in Clickz today, less and less of consumers' interest:
the branding effectiveness of online advertising has declined over the past two years by nearly every measure, according to data provided to ClickZ by Dynamic Logic. Explanations for the decline include the rise of ad clutter, the desensitization of Internet users to display ads and other causes. But the trend is clear.
Ken Mallon, Dynamic Logic's VP Product Development and Custom Solutions, said one factor in the sagging brand impact of digital ads might simply be competition among large brands for share of mind. "A few years ago there were less big brands online than there are now," he said. "If you were a Pepsi or GM you were more likely to get noticed. Now everybody's online. Every brand you can think of has a reasonable spend online."
Marketers are debating what to do about the trend. Suggestions include a greater emphasis on non-traditional advertising such as viral campaigns and pressuring publishers to display fewer advertisements per page. The findings are also likely to stir the controversy over which metric can best capture the value of online advertising.
(Image of cluttered desktop by jluster, CC 2.0)