The Top Ten brands in the States, including Apple and Google, don’t advertise on US TV.  Some of the world’s biggest brands are now using the internet as a marketing channel in equal measure to TV, radio, press, PR and other more traditional marketing formats.  American Express, Nike, McDonalds, Adidas, Land Rover, BMW and British Airways are marketing online more now than at any other time in their history.

In March 2005, Pepsi announced that they would launch their new Pepsi One product in US without the use of a 30 second TV advert.  This tried and tested format would be replaced with events, online films, online advertising and trading cards.  This is symptomatic of a swing in the advertising industry – in the last 12 months online marketing has expanded beyond all recognition, and gained a credibility it didn’t previous have in the process.

In particular amongst younger demographic targets, advertisers are recognising that lifestyle patterns are shifting, and old school campaigns such as print, radio and TV don’t have the effectiveness they once had for certain types of campaign.  With more TV channels than ever before, TiVo, and of course the internet, more empowered, savvy and suspicious customers than ever before, advertisers recognise the need for change.

According to European Interactive Advertising Association the following activities are done less as a result of using the internet:

• Watching TV, 46%
• Talking on the phone, 34%
• Reading newspapers, 33%
• Reading books, 32%
• Listening to the radio, 22%

They report that the average European spends 20% of their time on the web, which is 3 – 5% greater than the average American.  The web has taught us that where America leads, Europe follows so these numbers might be to do with the proliferation of broadband in the US, versus narrowband access issues remaining in Europe.

There are two big winners in this new climate, firstly online media platforms, and secondly companies of varying size who choose to market wisely online.  Yahoo’s profits for the last three months of 2004 rose to $187m, up a full 105% on profits from the same period in the previous year – profits made possible by banner advertising revenue.  The ability of internet technology to segment and filter audience groups make it a compelling platform for companies wishing to target specific audience types or demographics.

Jeff Lanctot, VP of Media at Razorfish, the largest online ad agency in the US comments “We saw a complete change of philosophy last year, faced with a multi–channel media landscape and corporate belt tightening, marketing departments began to see online advertising as a cost effective medium.  Brand advertisers once considered online an emerging technology they should test but in 2004, they considered it an essential part of their campaigns.”

This view is reinforced by findings from a JupiterResearch report, which forecasts that by 2009 online advertising revenues will have doubled, to $16 billion in the US, and €5 billion in Europe.  Whilst online spending increased 27% across these geographies in 2004, it still only composed 4% of overall media spend – by 2009 this will be closer to 10% of media spend.

Quite probably it is the abundance of choice and knowledge of user behaviour which makes internet marketing so compelling.  Campaigns can be filtered by gender, by search phrase, by country, by time of day, by day of week.  They can take the form of search engine campaigns, promotional websites, search engine optimisation, online sponsorship, banner / button ad campaigns, and various forms of direct email, text and viral marketing.

This offers an opportunity which Media Directors and businesses alike must embrace in the coming months and years.  Web marketing is here and here to stay.  Globally it is estimated that there are now five times more people online than there were at the height of the dot com madness in 1999 / 2000.  Global brands and local businesses alike are proving that web marketing is an essential part of a marketing and communications mix.

It is important that while organisations don’t rush headlong into web advertising for its own sake, that it is explored as a credible medium to get targeted relevant messages to your audiences.  Others have used it profitably to the benefit of their organisation – quite possibly it is time for your organisation to consider the same.