2007 Online Trends Predicted

http://www.imediaconnection.com/global/5728.asp?ref=http://www.imediaconnection.com/content/13055.asp

By Gal Trifon

Eyeblaster's CEO shares his thoughts on what should be front-of-mind for marketers in the new year for continued online advertising success.

While the weather is colder this time of year, the temperature continues to rise in the world of online advertising. New online advertising and marketing technologies, including the exploding popularity of user-generated content and the affirmation of the internet as a profitable advertising outlet points to 2007 as an exceptional year for marketers and publishers.

2006 has been a year in which user-generated content, social networking and online video websites thrived. Technologies were introduced to allow integration of search and display campaigns and leveraging games as advertising channels. Next year will be about how marketers can step up content and effectively monetize the vast advertising opportunities found on the web. The following predictions will help marketers understand what 2007 holds in store and what should be front-of-mind when it comes to continued online advertising success.

So, in no particular order, the top seven most important trends for online advertising and marketing in 2007 will be:

1. Rich Media - The Ultimate Tool for Impact and Engagement to Become the Standard for Display Advertising
In 2007, rich media will play a vital role in the continued growth of online advertising. In fact, rich media's importance in 2007 has been solidified by recent JupiterResearch data that projects the format will grow at a 21 percent compound annual growth rate (CAGR) through 2011. Extending its rise in 2006, rich media content will continue to be dominant in 2007 with more brand advertisers building confidence in the medium and driving rich media towards mainstream integration.

* Online Video
As rich media becomes more and more attractive to marketers, online video will also continue to make significant headway. According to a recent ICM poll, the online video explosion has even caused consumers to reduce the hours they spend watching TV. 2007 will see online video advertising becoming simpler and more effective with the help of new technologies to produce, deliver and track video ads.

Online video content will flourish as the user demand for a diverse array of programs strengthens. Because of the reasonable costs, short time frames required and success of web-specific video, marketers will more wholly embrace creating video advertising content for the web. The use of pre-existing video will also continue to increase, bolstered by the improvement of online video display capabilities.

* Interactivity
Engagement with web users will continue to develop as a success criteria for online advertising. Marketers will aim to leverage their website experience against a broader audience by creating ads as microsites to provide information, drive response and shorten sales cycles. The potential to tie in users' social networks with such features as texting and forwarding content will be appealing for advertisers. So will the ability to capture richer, more meaningful data through user interactions beyond the clickthrough, such as time spent engaging with different areas of each ad.

2. Integration of Search & Display Advertising
As the advertising pie continues to increase, analysts are noting the dominance of growth in the search and display categories. Earlier this year, JupiterResearch forecast search to lead online ad spend growth over the next five years.

Marketers who want to optimize budget allocation will need to integrate their search and display advertising management, so that the effectiveness of different formats can be accurately evaluated. Advertisers will need tools to simply and effectively optimize campaigns by eliminating duplications of buys and exposures. All the while, they can get the same or better conversions with less or equal spend.

3. Emerging Media - In-Game & Mobile Advertising
Extending the buzz of 2006, in-game advertising is sure to be a staple next year. With cleverly placed ads, in-game advertising has proven to be attractive to audiences, performing well for advertisers and becoming a clear monetization opportunity for game developers and publishers. Forecasts for in-game advertising are increasing, with some research firms such as the Yankee Group estimating in-game ad revenues to reach $732 million by 2010. With the ability to target a drastically different demographic than core games, casual games will continue to be a sought-after opportunity for advertisers targeting women over 30.

Mobile advertising will continue to hold great marketing potential, and the industry will see a rise in the proven mobile content sponsorship activity. Marketers will explore replacing subscription fees with ads, allowing carriers and content publishers to monetize premium content in the mobile environment. Like VOD and IPTV, the mobile marketing opportunity is still in its nascent stages, but all eyes will anticipate how mobile advertising plays out in the next 12 months' strategies to combat current challenges.

4. Content Explosions

* Social Networking and User-Generated Content
Social networking sites attract nearly half of all web users according to recent research from Nielsen/NetRatings. No longer just an online meeting place for people with shared interests and backgrounds, social networking sites have become a haven for cutting edge content. The opportunities for marketers are clear: Advertisers can target more specifically, virally spread communication across communities and tailor their ads for very specific content. The companies that "win" will effectively sort the massive amounts of user-generated content for quality content that presents prized monetization opportunities.
* Traditional Media Moves Online
2007 is sure to see more media outlets break out of the traditional subscription and advertising model-- leveraging online and offline presence in an integrated manner, offering networking capabilities to their audiences and broadening the range of available ad formats and targeting capabilities to improve their offering to marketers of all kinds.

5. Multi-channel Integration
As campaigns become more complicated and advertisers have more options than ever, effective management will be the key to generating meaningful results. The best advertisers will be able to manage their campaigns with comprehensive data, modifying and optimizing buys in real time. Successful channel and campaign integration will also result in consistent brand messages across multiple media channels and multiple audiences.

6. Global Presence, Local Customization
Just as barriers across channels have broken down for marketers, so have geographic lines. The best campaigns are no longer limited to the largest markets and 2006 was evidence that great campaigns can come from any agency in the world. The most successful advertisers will generate global campaigns with local twists tailored to respective markets and will look for partners with both global and local capabilities.

7. Ad-Supported Applications
In the year ahead, Microsoft and Google will continue their accelerated activity in providing consumer applications that are sponsored by new and innovative online ad formats. Other application developers will follow as marketers learn to leverage the unique characteristics provided by an application that is installed on consumers' computers and are interacted with on frequent basis.

2006 has solidified online advertising as a viable, lucrative medium for marketers, paving the way for a year ahead defined by proven successful technologies such as rich media integrating with emerging platforms like in-game and mobile advertising. Additionally, the online media landscape will benefit from more marketers realizing the potential of online advertising and the role they can play in creating and maintaining a strong brand presence in 2007 and beyond.