Tuesday, December 05, 2006

Future of Web advertisement is in Britain

If you want a glimpse of the future of advertising, you can hire a consultant — or you can travel to Britain. British marketers are embracing new techniques for the Internet. For example, Hewlett-Packard used an email campaign in Britain, to try to attract potential customers to a Website promoting its products.

Online advertising is racing ahead in Britain, growing at a roughly 40 per cent annual rate, and is expected to account for as much as 14 per cent of overall ad spending this year, according to media buying agencies. That is the highest level in the world, and more than double the percentage in the United States.

There are big differences between the advertising markets in Britain and the United States. In Britain, much of the advertising is national, while there are strong local and regional ad markets in America. Still, some believe that online advertising in Britain provides somewhat of a roadmap for where online ads in the United States and elsewhere may be heading. “The US is so behind,” said Terry S. Semel, the chief executive of Yahoo, in a recent speech in London. “It’s certainly lagging the UK by at least a year or two.” More than their American counterparts, British marketers seem to have bought into the oft-touted benefits of Internet advertising: that it is easy to track, enormously effective and a relative bargain. In Britain, as Internet ad spending surges, the overall advertising pie is not growing much at all, and traditional media are the ones losing out.

However, British media are nearly all aimed nationwide in contrast to the United States newspaper and television markets, where local and regional markets are big players. These local markets in the United States have, so far, been slow to move ad money online.

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