Business statistics can often reveal a great deal of information about a market or trend. A single number, like a picture, can be worth a thousand words. Take 9.3%, the prediction for the share of total US media spending going to the Internet this year (in 2007, the share was only 7.4%).

In absolute terms, 9.3% translates into $27.5 billion being spent on various forms of Internet advertising in 2008, according to eMarketer projections. That number, in turn, reflects a variety of trends and industry developments that are expected to take place. For example, advertising on social networks and online video are both projected to grow at double-digit rates this year.

But while video and social networks are among the hottest new ad formats today, they will account for only $2.9 billion, or about 10% of total online advertising dollars projected for 2008.

These trends, while important, are superseded by three deeper, more fundamental transformations taking place in the media world. These transformations aren’t so easily captured by numbers.

The first of these transformations starts with media fragmentation, which, because of the Long Tail effects of the Internet, is expanding exponentially. However, we are now learning how to harness media fragmentation to serve the needs of advertisers, publishers and, yes, even consumers.

Over the past year, we have seen significant consolidation and simultaneous expansion among the online ad networks. Ultimately, as these ad networks continue to grow and become more sophisticated in their ability to target specific consumer groups, they will allow advertisers to reach large audiences that are stitched together from hundreds or thousands of diverse Web sites. Eventually, advertisers will be able to have their cake and eat it, too: They will enjoy precise targeting of ads without sacrificing reach.

As Adam Gerber of Quantcast has said, in the future, online media buying will be about "the re-aggregation of a fragmented audience that's actually watching different things."

The second transformation is that the Internet is becoming the central hub of most media and marketing campaigns—and for good reason. Not only is the Internet now used extensively by every major demographic group, and for a variety of purposes including information, communication and entertainment, but it also allows for a two-way interaction between consumers and marketers that is not found in any other medium. Just as important, the Internet can provide a wealth of measurement metrics to help marketers justify and fine-tune their integrated media plans.

But it is the third transformation that will have the greatest effect since it transcends the Internet and affects all media. For decades, the ad industry was built on the interruption-disruption model. Consumers understood that if they wanted to experience free content—in the form of television shows, music on the radio and magazine articles—they would have to put up with ads, most of which were perceived as irrelevant, boring, annoying or all three. In this standard construct, ads were seen as a “necessary evil” to support the content consumers really wanted to see.
 

As a result, advertisers and their agencies who want to engage with today’s consumers will have to start turning their ads into content. Ultimately, they will need to be able to produce content that is so compelling, relevant and entertaining that consumers will seek it out and want to share it with others. The new ad model is about creating great content and finding clever ways to embed it in the fabric of communities and content platforms where consumers are hanging out and actively participating.

Baby boomers are the largest demographic segment of the population today, according to JWT BOOM-BoomerEyes/C&R Research study data released in January 2008.

The companies found that 78 million boomers spend about $2 trillion annually.

"The fastest-growing segment of the population over the next five years is the 60-to-64 cohort comprised of the leading-edge boomers," said Lori Bitter, president of JWT BOOM. "The number of people aged 50 to 64 will increase by 8.1 million, while the number of 30- to 44-year-olds will actually shrink to 2.7 million."

The demographic group keeps busy online. Nearly all boomers surveyed said they used e-mail. About seven in 10 said they shopped online. Nearly three-fourths said they looked for health-related information.

About half of all boomers surveyed said they played online games and downloaded pictures.

While nearly one-third of boomers said they visited online communities, only one-tenth of boomers said they had ever blogged.
 

Gift card sales will increase nearly $14 billion over the next five years, according to Packaged Facts' "US Market for Prepaid Cards with a Focus on Gift Cards" report.

The cards are part of an overall $81 billion market for prepaid cards.

"Gift cards are revenue drivers for merchants, who benefit from consumers' tendencies to spend more in the store, for banks, who charge fees for use and benefit from increased electronic transactions, and for third-party processors, who provide back-end processing and maintenance," said Tatjana Meerman, publisher of Packaged Facts.

More than one-third of consumers surveyed who purchased gift cards in the last 12 months said they expected to spend more on gift cards during the next 12 months, and 9.1% said they expected to spend "significantly more."

More than half of gift card redeemers often or always spend more than the card value, and most likely over two store visits rather than one.
 

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Member Alerts

This Valentine's Day is shaping up as one of the sweetest ever, thanks to eBillme. Between Jan. 15 and Feb. 14, every shopper who uses eBillme to checkout at featured retailer sites will get a free 8 oz. box of Harry London(R) assorted gourmet dark chocolate truffles, made exclusively for eBillme merchants and customers, which 1-800-Flowers.com, Inc. will ship to any address in the continental U.S., along with a personalized note, free of charge. This promotion is being offered by several featured eBillme merchants.

"Valentine's Day is the holiday for giving and showing how much you care which is why we decided to team with 1-800-Flowers.com to help give shoppers something special for their Valentine," says Marwan Forzley, President and CEO of eBillme. "This promotion is a great way for consumers to try eBillme on our featured retailer sites, and experience how safe, secure, and convenient checking out with online bill pay can be."

During the promotional period, every shopper who pays with eBillme at the featured merchants' checkout will receive a special order confirmation form in their e-mail. The form will allow them to write a personal note to their Valentine, and specify a shipping address. When they e-mail the form back, eBillme and 1-800-Flowers.com will ship a complimentary box of chocolate truffles to the address, with the personal message attached. Shoppers can send the truffles to any address in the continental U.S. Both the chocolates and the shipping are free.

"Valentine's Day is one of our biggest holidays, and we are dedicated to ensuring that all of our customers are able to make this holiday a special day for those they love," says Eric Gehnrich of 1-800-Flowers.com. "We're simply delighted to be working with eBillme to spread the love--and the chocolate--this Valentine's Day. We hope that shoppers will take advantage of this limited-time offer, and choose to checkout and pay using eBillme so that we can help make the holiday a little extra special for the ones they love."

The eBillme Valentine's Day promotion runs from Jan. 15 to Feb. 14 at featured eBillme merchants. A complete list of featured merchants can be found at http://www.ebillme.com/index.php/promos/valentines. Shoppers must make their purchases, pay their eBills, and submit their personal message and mailing address forms by Feb. 7 to guarantee arrival of the free Harry London truffles by Valentine's Day. The promotion is limited to one box per customer.

When shoppers choose eBillme at checkout, their order is confirmed with an eBill that's sent to their e-mail address. Shoppers simply pay the bill through their online checking or savings account, the same way they pay other e-bills. The transaction occurs securely, bank to bank, with no personal or financial information required or transmitted over the Internet. In fact, because it takes advantage of the inherent security of the U.S. banking system, eBillme is the safest way to pay bills online. And, because every transaction is paid with cash, consumers don't increase their debt burden.
 

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The floral industry is a $16 billion market, according to JupiterResearch data cited in a January 2008 New York Times article. The Times also reported that Valentine's Day is second only to Mother's Day in flower sales.

In the run-up to V-Day, one flower vendor is launching a multichannel promotion asking consumers to make a video of the most intriguing marriage proposal.

"1-800-Flowers.com is taking advantage of how consumers use the Internet," said Tim Armstrong, president of advertising at Google. He said Google would not be trying to re-route Web traffic to its site.

"That's the game-changer for YouTube," he added. "If it can become a platform where marketers learn to leverage the community rather than reroute it."

1-800-Flowers.com said that budget for the promotion was being drawn from traditional media spending.
 

Old-time sales pros always believed in the importance of face-to-face contact. Now new media is making that contact easier than ever.

Last year was the first time trade shows—referred to as “face-to-face” media by American Business Media (ABM)—surpassed business publications in share of total revenue.

Emphasis on socialization is growing for digital media, including social media such as such as blogs, wikis and social networks.

eMarketer projects that, in 2008, US B2B online advertising spending will increase almost 26%, to $4.4 billion.

"B2B marketing is undergoing tectonic shifts," says Lisa Phillips, eMarketer Senior Analyst and author of the new report, B2B Marketing Online: Business Meets Social Media. "One thing that hasn’t changed, though, is that sales cycles remain long and complicated."

Reaching the ultimate decision-maker is still the key goal, but marketers also need to target researchers, technical advisors and negotiators at every stage of the process.

In fact, according to MarketingSherpa, the number of people involved in purchase decisions continues to grow, averaging 21 people in larger companies.

"The most efficient way to ‘see’ more prospects and influencers face to face," says Ms. Phillips, "is through the use of new online media alternatives."

Nevertheless, in a recent BtoB magazine survey of marketers, traditional digital strategies remained popular.

Web-site development was the main tactic used to attract new customers; e-mail was a strong second; and search engine marketing placed third.

“B2B marketers are a little out of step with their target audience,” says Ms. Phillips. “While marketers put more marketing efforts into their corporate Web sites, many business decision-makers are looking elsewhere for critical buying information.”

In an Enquiro survey, B2B professionals were asked what sources were most helpful to them in the purchase decision-making process. Manufacturers’ sites consistently topped the list. Search engines were second, and second-tier tactics such as video, opt-in e-mail, RSS feeds, webinars, podcasts and social network sites were also cited as important. (B2B blogs did not make the list because Enquiro did not include the choice in its survey.)

"Business marketers are on target with their plans to spend on search marketing, e-mail and corporate sites, but would be better served to move funds out of traditional media and toward more word-of-mouth venues such as Web-based events, trade shows and conferences," says Ms. Phillips. "The more daring will try online video, blogs and other social media to reach decision makers as the wander the Web."