comScore's Fulgoni: Rumor Of Display's Death Greatly Exaggerated

CAPTIVA, FL - During the opening keynote at the Search Insider Summit here, comScore Chairman and Co-Founder Gian Fulgoni told members of the search marketing world's elite that the economic downturn - and its negative impact on the digital advertising marketplace - "appears to have bottomed out." He also revealed data contradicting the conventional believe that online display advertising has been eroding.

"If you look at the growth rate for online display advertising just doesn't look good," Fulgoni noted, citing the recent Interactive Advertising Bureau and PricewaterhouseCoopers' Internet Advertising Revenue Report for the fourth quarter of 2008. But that top line finding is misleading, Fulgoni added, citing a comScore analysis of the IAB data, which shows that ad spending on traditional, static online display ads such as banners actually is growing, not waning during the downturn.

After "peeling back the onion," Fulgoni said comScore's team found that the real hit in the so-called "display" business has been for "rich media" formats, which declined 19% during the fourth quarter.

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"The banner actually increased in the fourth quarter," Fulgoni said, citing an 8% rise in the online industry's standard static advertising unit.

Fulgoni speculated that the main reason for rich media's decline is that marketers are opting for "cheaper media," and traditional banner ads are just a bigger bang for the buck. When asked then why online video advertising continues to rise, Fulgoni said it likely is because it's coming off a "smaller base" of total ad spending, and because marketers are more willing to experiment with the emerging medium.

Economic trends aside, Fulgoni indicated there is a more fundamental, underlying shift taking place in the way some big marketers - especially consumer packaged goods marketers - are starting to think about online advertising, and that the availability of better, more precise analytics and metrics showing the affect online advertising has on offline sales is beginning to alter their communications mix.

Fulgoni, who before founding comScore was the head of consumer product scanner data tracking firm Information Resources Inc., said the availability of the new data and insights will lead to a reallocation of budgets to online media. He even cited a recent white paper released by comScore online audience measurement competitor Compete, which he termed a "nice study," revealing the "power of search on [consumer packaged goods marketing]."

Fulgoni implied, however, that that market is still largely untapped, and that "there's a gold mine here" for the companies who figure out how to mine the data.

2 comments about "comScore's Fulgoni: Rumor Of Display's Death Greatly Exaggerated".
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  1. Rich Reader from WOMbuzz, May 8, 2009 at 2:39 p.m.

    Has static display ad revenue actual bottomed out, or is Mr. Fulgoni interpreting leading indicators?

  2. Sarah Grant from adMarketplace, May 8, 2009 at 4:28 p.m.

    And it seems, rather than debate the life and death of display, we should be looking at what converts. Does display advertising convert? Sort of. Does it convert better than search? No. I feel like Fulgoni's answering the wrong question - we should be asking how to improve the effectiveness of the ad. Theoretically, the revenue should follow.

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