The Internet Comeback

Last week, the Interactive Advertising Bureau reported that for the first time since 2000, two consecutive quarters saw increases in online spending increases. Does it mean the medium is out of the doldrums? The experts are optimistic.

Greg Stuart, CEO of the IAB, says he's confident this increase is "indicative of a larger trend at work. Of late, major marketers such as McDonalds have announced they intend to pour more dollars into the interactive space, and I'm certain their counterparts and competitors are also too smart to ignore that interactive is an integral part of the media mix."

The operative word across the board seems to be "integration"

Michael Drexler, Optimedia's Chief Executive Officer, says, "I think that the Internet and the organizations associated with the Internet have made remarkable progress to move the whole area ahead. And I think they've finally now have reached a point where a lot of the requirements, in terms of being able to evaluate the internet along with traditional media, are virtually there."

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Drexler, much like many of his colleagues in the advertising media industry, is seeing a shift in traditional advertisers' opinion of the Internet. "What we're finding is that a lot of the traditional advertisers are asking more and more about the Internet as an integral component and how it can be integrated with traditional media. I find that happening quite a bit, accelerating," he says.

According to Drexler, the challenge for media agencies now is "to figure out how to make sure the Internet is no longer an isolated community and that the people who are involved and who have gained the expertise are now involved and part of the whole media planning process."

Fred Rubin, SVP iDeutsch, says that these days, "When we present plans to a prospective client today we present them as part of a comprehensive package," which is a step in the right direction.

"I think there used to be the sense that people who were selling the Internet were trying to sell the client on the fact that his current advertising was bad," Rubin says. "That turned a lot of people off," he says, because the Internet "was never the answer to everything," but it is a matter of "the left-brain and the right brain coming together on the client side. People are starting to see the data that speaks to the value of Internet advertising. And the creative continues to improve."

"The resentment is starting to wear off," Rubin says. ""I feel like we've suffered from the hype long enough. The IAB numbers are the latest in a series of leading indicators that show that we're coming out of the tunnel."

Rubin also expects pharmaceutical companies to be among those leading the Internet ad comeback.

Some experts are quick to bring up the concept of growing pains, even as severe as those of the last 2 years, and point out that the interactive medium is less than ten years old with a bright future in front of it.

Michael Zimbalist, Executive Director of the Online Publishers Association, says, "I think we're at the moment in time where television was in the mid 50s. What lies ahead is a generation of consumers that grew up with this as part of their media landscape. The medium right now is fueled by actual operating cash from companies that are showing good results. What lies ahead is a bigger medium than any of us could imagine.

"Kids are integrating it into their lives. 97% 12-15 years old were online last week. By the time they're college age and entering the work force they'll have been online for 10 years. They're not just experimenting anymore. The shakeout is behind us," Zimbalist says, adding that the medium is actually seeing growth rates right now. "The underlying market is growing," he says. "If you factor out the spending that was pure dot-com and use that as your baseline you'll see more steady endemic growth."

That's not to say the medium can rest on its survival laurels just yet.

As Drexler puts it, the media industry as a whole now needs to "make sure [the interactive medium] is evaluated alongside traditional media and the budgets that are allocated are allocated accordingly. It's not about picking up crumbs. It's about looking at [the internet] from a zero-base plan and seeing where it fits in."

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