SpectatorBytes

Venture Beat picked an interesting story from Ad Age which outlines the challenges facing the online advertising industry (See Here) which outlines the challenges facing the onlineadvertising industry. Below is one of the most interesting statement’s in the Ad Age piece.

“The inconvenient truth is that for all its new-media spin, display advertising is “old” media — a commercial message to be placed next to editorial or entertainment content. And we know by now that measured-media growth has pretty much ground to a halt as marketers continue to increase their dollars in unmeasured disciplines such as web development, public relations and database marketing at the expense of paid advertising. Ad spending among the top 100 U.S. advertisers last year grew a paltry 1.7%, with measured media only up 0.3%. Measured-media spending is in decline in Japan, and it’s not much better in the U.K.

Sure, dollars are shifting within those media budgets, with some moving out of traditional media into interactive. But most of the top 100 advertisers that wield the big budgets are still primarily TV and print spenders. The question is: Should the fact Procter & Gamble spends only 1.5% of its marketing budget on display ads be viewed as a warning signal by online ad sellers, or as an opportunity? (Even Unilever, Ad Age’s Digital Marketer of the Year, spends little more on display, allotting it 2% of its budget.) Instead of thinking of how much more P&G could be spending on internet advertising, sellers should be asking why it doesn’t spend more.”

As I have outlined in several posts, the online ad industry need to continue to work on creating innovative solutions for brand advertisers. These solutions need to deliver on the unique capabilities of the Web: audience engagement, virality, and measurability. These solutions need to simply deliver a different value proposition than Television and Print. The current model of display advertising does not seem to do that…and thus brand media buyers are still holding back their online spend.