• by Erik Sass  @eriksass1, June 13, 2006

Manufacturing firms lag behind other businesses in online ad spending, according to a report released Monday by Outsell, Inc., a strategic consulting firm serving the information industry.

Based on a survey of 1,214 advertisers last November, including 188 manufacturers, Outsell concluded that manufacturing trails high tech and business services by 15 to 30 percent in total online spending.

Not surprisingly, high tech showed the highest affinity for online advertising, with 93 percent of respondents using e-mail marketing, 85 percent using search engines, 78 percent using sponsored content and 79 percent using "webinars."

By contrast, the manufacturing sector posted lower figures all around, with 79 percent of respondents using e-mail marketing, 68 percent using search engines, 55 percent using sponsored content, and 51 percent using webinars. Outsell broke down the manufacturing category into 16 sub-segments including aerospace and defense, apparel and fashion, automotive and auto parts, furniture, machinery, paper, rubber and plastics, and textiles--but all 16 reflected the same broad trend.

When asked what might account for this disparity, Chuck Richard, vice president and lead analyst at Outsell and the leader of this study, said that the long sales cycle discouraged manufacturers from using the Web. "In manufacturing, some people feel strongly that the sales cycle is so long that the fast turnaround allowed by online advertising methods doesn't really have the same value it does for other industries."

Richard added that this conclusion appears to be premised on some manufacturers' view of the Web as a direct channel, generating point-and-click consumer sales, rather than a branding medium--a view he disagrees with. "You can't overestimate the power of online methods across the board for branding. You have to be where your audience spends time, and all the data shows they're online."

Sarah Fay, president of Isobar US, concurred with Richard. "Manufacturers might still be struggling in how to use the medium because for them it's about a long-term play--the most important thing for them is to be perceived as a major player in the market. 'How can I look big in this space--how can I look important?' I don't have the numbers, but I can tell you the big players in the manufacturing market are still trying to get their heads around how to use online."