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More than eight in 10 (83%) European marketers say they increased their online advertising spending during 2009 and 94% plan to increase it in 2010 because of its ability to maximize limited budgets, according to a report from the European Interactive Advertising Association (EIAA). The Marketer’s Internet Barometer report (pdf) for the second half of 2009 also found that 93% of European marketers expect to further increase their online advertising spend in 2011.

In terms of the magnitude of this online ad spend growth, marketers predict a 7.6% year-over-year rise in 2010 and a sharper increase of more than 15% forecast for 2011.

The report also stated that seveal trends – including increased online spending, the growth of mobile advertising and the ongoing shift from traditional to online – will continue shape the industry in the years to come.

Online Brings Targeting, Cost Efficiencies

More than one-third of respondents in the survey (36%) revealed that they have increased online media planning in the second half of 2009 (vs. 28% in H109) in order to take advantage of the medium’s effective targeting capabilities during recession. This represents 29% growth since the first half of the year.

Value for money was also deemed a core driver, with 31% of marketers quoting cost efficiency as a reason for increasing their use of online, the survey said.

Email Gains Too

Email advertising has risen in popularity during the second half of 200, with 61% of those surveyed increasingly investing in this form of online advertising (vs. 46% in H109). According to the EIAA, Particular growth has been noted in the use of behavioural targeting (33% in H209 vs. 25% in H109), advertising networks (31% in H209 vs. 25% in H109) and affiliate marketing (36% in H209 vs. 26% in H109) as marketers may be? looking to make the most of streamlined budgets by tailoring advertising methods for clients.

Mobile a Rising Star

The findings also reveal that mobile advertising continues to be ‘one to watch’ over the coming months, attracting considerable current and predicted investment. One in three (33%) organizations are already incorporating mobile into their overall advertising strategies and nearly one in five (19%) claim that use of mobile advertising is increasing, up from 12% of marketers in the first half of the year. This represents a big jump, possibly driven by the increasing popularity of? smartphones.

Additionally, 86% believe mobile advertising spend has increased in 2009 and almost all (97%) predict growth during 2010 and again in 2011, EIAA said.

Reallocation of Traditional Budgets

In keeping with a major global shift online, the study found that advertising budgets continue to be diverted into online from traditional media formats. In comparison with H109, the biggest shift in spend has been from traditional direct marketing, with 30% of marketers who have seen an increase in online advertising spend saying that it has come from this area (compared with 24% in H109).

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Findings also show a sustained shift of investment from TV budgets. with more than one-third of marketers diverting spend to online in both H109 (37%) and H209 (36%), as broadcast content is becoming increasingly available via the internet on sites such as ITV.com.

Marketers in larger companies, in particular, are diverting more spend from TV into online (59% vs. 36% of all marketers) and it is behavioral and demographic targeting that are attracting heavier investment with 47% (vs.33%) and 29% (vs. 19%) of marketers respectively increasing their use of these online advertising formats.

Video also continues to secure budget from other media, with 33% of all marketers saying their use of online video advertising is increasing and 20% indicating that this growth is coming from other media budgets.

Results Prove Promising

As the shift to online continues, the survey also found that these investments appear to be paying off, with 84% of respondents satisfied with the performance of online as a medium and 96% seeing it as an essential or growing medium.

“Online advertising is continuing to thrive and grow due to its flexibility, accountability and ability to offer brands a robust return on investment whilst the recession impacts overall marketing budgets,” said Alison Fennah, Executive Director of the EIAA said. “For this reason, online advertising is further consolidating its position as the medium of choice for marketers across Europe. Marketers still seek innovation with new formats such as mobile evolving and helping interactive media to emerge strongly as we look forward to the upturn.”

About the report: The EIAA Marketer’s Internet Ad Barometer provides a snapshot of the current trends and opinions of the advertising industry across Europe, gathering information from decision makers who have responsibility for allocating their company’s media budget and setting advertising strategy. The bi-annual survey offers a snapshot of the current state of the market and insight into future trends.

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