Data Nugget: Banner Ad Spending Will Be 20.9% Of Internet Ad Spending This Year Says eMarketer's Hallerman

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In a discussion with AdExchanger.com, Emarketer's senior online advertising analyst, David Hallerman, looks at display advertising and current challenges in display ad research today.

eMarketer On Display AdvertisingAdExchanger.com: Briefly, what does eMarketer's most recent research say about expected ad spending trends in online display? And what are the drivers?

Trends in online display ad spending point to its diverse uses. While US banner and rich media ad spending in 2010 will grow slightly at 3.3% and 5.5%, respectively, online video ad dollars will jump by 39.9%.

Those mild but positive spending gains for banners and rich media describe a commoditized ad format that many marketers will use mainly to fill gaps in online campaigns.

Video, on the other hand, is still the holy grail for brand marketers online. The high growth rate will be due to the untapped dollars flowing into video ads, supported by the increased viewing of professional video content -- which gains more trust from brands than user-generated content.

Perspective, though: While video spending will increase tremendously, it will represent only 6.1% of total Internet ad spending this year. In contrast, banner ad spending will be a 20.9% slice of the total pie.

AdExchanger.com: What are some of the key challenges when researching a piece for display advertising?

The main challenge is figuring what portions of the banner ad market is sold on a CPM basis, as compared with the growing share sold on a performance basis.

Furthermore, even as spending growth is relatively flat at 3.3%, the increase in impressions will be greater as the per-unit cost drops. That shift points to the ways that banner ads can be seen as a foundation supporting other online advertising, such as paid search, and offline ad campaigns on TV, radio, and print.

By John Ebbert

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