|The Interactive Advertising Bureau has released the results of First Half 2011 industry performance report for the US market. The research was conducted by PwC. I’d like to share some highlights.
First Half Industry highlights:
- Internet advertising in the US increased 23% in the First Half 2011 vs. 2010 and totaled $14.9 billion. FYI – the 2002 total was less than $3 billion.
- 72% of all Internet advertising revenue is concentrated in just 10 companies. Where do you think Google fits in? (hint – see next bullet)
- Search remains the #1 advertising format and accounts for 49% of all revenue – up from 47% last year.
- Retail advertisers are the biggest spenders and account for nearly one-quarter (23%) of all Internet ad spending.
- Performance based pricing (PPC) grew from 61% of all advertising to 64% in First Half 2011. Impressions based pricing (CPM) declined from 35% to 31%.
- Here are the percentage increases for the top spending industries vs. First Half 2010:
- Retail +40%
- Telecom +24%
- Financial +27%
- Automotive +27%
- Computing + 25%
- Leisure Travel +43%
- Package Goods -12%
- Entertainment +1%
- Media +25%
- Health Care +1%
First Half Leisure Travel highlights:
- Leisure Travel (including airfare, hotels and resorts) accounts for 8% of all Internet ad spending – up from 7% last year.
- Leisure Travel spending increased a whopping 43% – nearly double the rate of the industry as a whole.
- Leisure Travel breached the $1 billion mark in the first half, jumping from $841 million in 2010 to $1.2 billion in 2011.
Implications for Hotels
- With marketing budgets remaining relatively flat it is obvious Leisure Travel companies are continuing to divert funds from traditional advertising to the Internet.
- Marketers are increasingly interested in measuring the performance of their advertising and the Internet does this better than traditional advertising.
- Internet marketing (advertising, social media, SEO, etc.) is becoming an increasingly important and complex marketing environment. Hotels need access to state-of-the art Internet thinking to succeed in this ever changing marketplace.
How has the allocation of funds between traditional and Internet advertising changed in your marketing budget? What are you planning for next year?
Hoteliers can receive a copy of the Interactive Advertising Bureau research report by sending an email to me with full signature/contact information.
Safe travels – Madigan Pratt
About Madigan Pratt
Madigan Pratt has more than 25 years of strategic marketing communications experience, including advising Fortune 500 companies, Tourism Boards, destinations, and luxury resorts. Madigan leads a team of marketing, public relations and social media professionals at Madigan Pratt & Associates. Originally founded in New York and now headquartered in Williamsburg, Virginia, Madigan Pratt & Associates is an award-winning marketing and advertising agency specializing in customer relationship marketing for hospitality and luxury service clients.
A well published author and popular conference speaker, Madigan provides expert counsel to the hospitality industry and publishes tips at Hospitality Marketing Blog. He has served on numerous travel industry association boards including the Caribbean Tourism Organization, The Association of Travel Marketing Executives and HSMAI Resort Marketing Advisory Board.