The growing popularity of online social networking and video content is deepening web users’ engagement with the internet and is causing a dramatic shift in the global online landscape – both for consumers and for advertisers, according to a report from The Nielsen Company, which was distributed at the ad:tech conference in San Francisco.
Nielsen’s research shows that since 2003, the interests of the average online user have shifted significantly, evolving from use of “short-tail” portal-oriented browsing sites – such as shopping directories, guides and internet tools – to sites that contain more specialized “long-tail” content geared to specific and interactive user interests:
This change is manifested by the fact that video and social networking sites are the two fastest growing categories in 2009, and will necessitate new ways of thinking about online marketing, Nielsen said.
Major highlights from the Global Online Media Landscape report (pdf) regarding online video and social networks:
Online Advertising Down But Not Out
With the global recession in full swing, Nielsen reported that online display advertising has plateaued at 20% of total online ad spend in the US. Not surprisingly, online advertising by financial services, automobile and retail companies has declined steeply as a result of ongoing troubles in those industries.
On the other hand, several key industries that historically spend significant amounts on advertising – such as healthcare, consumer products and telecommunications – appear to be moving even more spending online, Nielsen said.
As a result, though online advertising appears to have lost some of its “favored child status,” the longer-term prospects for global online advertising when the recession abates are brighter, Nielsen said, suggesting several reasons why online advertising will continue to be critical:
“The internet remains a place of continuing innovation, with users finding new ways to integrate online usage into their daily lives,” said Charles Buchwalter, SVP, research and analytics, Nielsen Online. “In recent years the Internet has changed dramatically as people seek more personalized relationships online. In particular, time spent on social networks and video sites has increased astronomically. Advertisers are starting to positively re-assess the value of the online experience and create more meaningful relationships with consumers.”
The Nielsen report, which examines trends in a multitude of countries on several continents, also noted that advertisers are increasingly starting to look at their media mix more holistically than ever before. For example, consumer-generated content has gained inclusion into the “earned media” club of marketing preferences. The big question going forward, Nielsen said, will be how paid and earned media share the marketing expenditure pie.
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