A majority of top ad industry executives expect a significant share of their broadcast and cable TV advertising budgets to shift to online video buys within the next few years, according to results of
an annual survey on industry trends released Tuesday morning by the American Advertising Federation. More than half (53%) of the 168 respondents said they expect 20% or more of their TV advertising
budgets to shift into online video by 2010 (see table below).
"The determining factor will be the sheer volume of online opportunities," said one agency executive participating in the survey.
"Will there be a handful of sites that rise above the fray or will there be so sites to choose from that the media dollars can't possibly cover enough bases to be effective?"
The study also
indicates that ad executives believe traditional broadcast TV outlets will be the most effective in integrating traditional TV and online media into seamless marketing solutions for advertisers and
agencies. Asked which media they believed to be most "innovative" at leading such integrations, 21.7% of the respondents cited broadcast TV, followed by newspapers and magazines (18.5% each), cable TV
(15.2%), and radio and out-of-home (8.7% each).
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Asked which traditional medium is most effective in terms of driving traffic to advertiser Web sites, 26.0% cited magazines, followed by broadcast
TV (17.8%), cable TV (16.4%), newspapers (13.7%), radio (11.0%), and radio (8.2%).
The survey also indicates that online ad budgets are expected to rise by an average of 42 percent in 2007 vs.
2006. Respondents said they expected 23.2% of their total 2007 ad budget to be spent online, up from 16.3% of their 2006 advertising spending.
The study, which was prepared by Atlantic Media
Company, is the fourth annual survey to be issued by the AAF.
Share Of TV Ads Shifting To Online Video By 2010
Less Than 1%: 2.6%
1-5%:
9.8%
6-9%: 11.1%
10-19%: 33.3%
20-29%: 34.8%
30-39%: 11.1%
40-49%: 5.9%
More than 50%: 1.3%
Source: 2006 AAF Survey of Industry Leaders on Advertising Industry and New Media Trends. Base = 168 respondents.