At first pass, this sounds like a really simple question, and you'd expect the answer to be just as simple -- but it's not. Back during Web 1.0, this was an obvious problem because the Internet hadn't yet reached mass audience penetration. Back then you would be hitting the 30%-40% of the audience that was online and you'd be hitting them with lots of frequency and with under-developed creative executions. No matter what you bought -- Excite, Webcrawler, Netscape, Yahoo or Pathfinder -- you'd be hitting the same "smallish" group of users.
Around 2000-2001, otherwise recognized as the birth period of Web 2.0, audience penetration started to become a non-factor, as it inched closer to 70% of the U.S. (even more in some other countries). Still, the medium was still maturing, the percentage of heavy Internet users was small -- and they would typically garner the majority of the attention against your online campaigns. You could buy the homepage of Yahoo and reach a large audience, but it would be the same audience every couple of days.
Now, at the close of 2009, as we enter into a new decade and the birth of Web 3.0, this question becomes interesting again. The mass audience is here. The creative units are impactful. The integration of video and the mass adoption of social media make for an attractive mix of possibilities for advertisers. I don't really think you can say that a brand could spend too much online.
There are single placements that will drive large reach in a short period of time, rivaling and exceeding that of any prime-time television show. There are more ways to target an audience and reduce waste than there are with any other medium. There are more unique, targeted content opportunities, and the creative impact is far higher than anything in the past.
You can create customized solutions with short-term runs, or you can go deep with a partner and create content that will live the length of the year, and possibly beyond.
Most consumers go to the Web for information that will influence purchase decisions (a recent stat said that 74% of U.S. consumers go to the Web for information on buying electronics).
Social media brings true brand evangelism to the forefront and gets as close to true word of mouth marketing as one vehicle can possibly achieve.
And the scope of possibilities in search alone will bankrupt some ad budgets just trying to maintain proper position for a 100% share of voice. Put simply, no brand is having trouble spending their budgets online.
This question is a no-brainer now. The Internet can take the budget and be very effective, but it's difficult to grasp just how much work it would be to spend that money correctly.
Spending $10 million online requires more time and attention than it does to spend $10 million in television. You can spend that much in TV with 4 people, but online it will likely take 10-12 people, and that is the lesson we've learned over the last few years. Spending the money means being accountable -- and being accountable takes time and attention, unlike in TV when spending the money just requires a phone call. TV is not an accountable medium, and the old adage of "I know half of my advertising is working, I just don't know which half" is where that comes from.
If you spend $10 million online, you will know exactly what was working and what wasn't -- but for my money, that's a good thing. If I were going to spend $10 million on paid advertising, I would certainly want to know it worked, wouldn't you?
So to answer the question: no one gets accused of spending too much in online these days. Sometimes they get accused of undervaluing the execution and the analysis of these efforts, and that could be their downfall.