Why is this important? Because without more proof that marketers can use online media for brand-building purposes, many of the world's largest advertisers will continue to sit on the digital sidelines. Armed with better insights, these advertisers can finally get in the game. It's also important because so many in the industry consider 2010 to be the end of the recession and therefore the renaissance of digital media. The point is, outsized growth in our market can only return once online media is shown to be an effective way to reach and engage consumers across all product categories (not just direct response).
Indeed, hope abounds. In its forecast of interactive marketing spending, Forrester reports that the industry will grow at 17% compounded annually over the next five years, compared to just 13% last year. While interactive spending represented net new dollars in most marketing budgets up until last year, going forward, nearly two-thirds of marketers indicated they will shift dollars away from direct mail and print toward digital media. But it is one thing to predict a spending increase, and something altogether different to confidently take online from 1% to 10% of your total media budget if you're a CPG marketer.
Yet this is exactly what needs to occur in order for Forrester's prediction to become a reality. Simply put, the online ecosystem needs packaged goods companies to move beyond experimentation and embrace the Web as a medium that they can use for brand advertising. By taking advantage of new insights into their online audiences, these companies can integrate digital into virtually every component of their marketing -- from strategy development, to media planning, to engaging and effective brand-building experiences (apologies to my television ad sales colleagues who were looking to pick up those print dollars).
Our work with clients clearly points to increased demand for new audience insights to help them spend more effectively online. Gone are the days when simple audience measurement tools were sufficient to plan and measure campaigns. Now brands are looking to define micro-audiences based on their interests and behaviors. Likewise, publishers are looking for deep audience data that describes consumer behaviors on and off of their sites. Audience insights eclipse audience measurement, providing new views into "who" and "what impact," versus simply counting "how many."
And there is a new crop of tools that have been designed to help buyers and sellers move beyond audience measurement to tap richer audience insights. Tools like Google Ad Planner, Quantcast, Comscore Direct and Compete's new offerings with Fox Audience Network and WPP Digital's Media Innovation Group all provide new audience insights that can be used for media planning and measurement (some of these services are free). All of these tools combine consumer panels and sophisticated analytics platforms to describe consumers in ways that other approaches can't match, including rich demographics, longitudinal behaviors and interests, and offline buying behaviors. With this kind of technology under the hood, all brands will benefit from new insights to market online.
It is difficult to imagine a future where P&G, Unilever, and other large brands don't allocate more dollars to digital media. While the pace and scope of this increase remains to be seen, we do know that each 1% shift from traditional to online translates into hundreds of millions of dollars. And this is a benefit shared across marketers, publishers and consumers. By introducing measurement and metrics that are more relevant to brand advertisers, we can ensure the next phase of digital growth (and save Randy from alien abduction).