2008 Global Digital Media - Advertising and Marketing

Publication Overview

This annual report offers a wealth of information and analyses on the worldwide advertising and marketing sector in relation to Digital Media developments. It includes information and statistics on the worldwide advertising industry with a focus on online advertising developments. The report provides an overview of the key Internet Media players and their activities and a case study on the industry leader, Google. It includes an overview of marketing strategies such as permission and location based marketing. Information at a regional level is also provided for the Americas, Europe, Middle East, Africa and Asia Pacific.  

Subjects covered include:

  • Advertising market including statistics and forecasts;
  • Digital Media marketing strategies;
  • Permission based marketing;
  • Location based marketing;
  • Media industry analyses;
  • Internet Media company activities;
  • Case study on market leader Google;
  • Net neutrality analysis;
  • Regional information and statistics.

Researcher: Kylie Wansink

Current publication date:- April 2008 (1st Edition)

Next publication date:- May 2009


Executive Summary

In the digital media era the traditional media companies have made quantum leaps in comparison to the telcos in terms of advertising and marketing. While the Internet companies (ie, Google) have clearly been the leaders to date, media companies are now making great progress. New advertising models, permission-based marketing and premium sales activities are being used to attract people to events and services. New video applications are also emerging as the Internet media companies seek to exploit the added speed and capacity of broadband infrastructure. For more information, see chapter 3.1, page 40.

The most significant change broadband is bringing to the market is that it is opening up consumer markets. For decades, only corporate users have been able to afford data services. The Internet quickly used this new data development to create an enormous number of consumer applications. Broadband improved the quality, allowing for video-based applications, and, just as importantly, it made access to digital media affordable to the mass market.

The rise of the Internet, mobile phones and other digital media is forcing marketers and their suppliers, including ad agencies, to adopt new business models and broaden their offerings. Although the Internet still only accounts for a small percentage that will be spent on media advertising in 2008, its influence spreads much further than that. It is changing the way consumers are exposed to and interact with advertising.

To date, traditional ad agencies have been accustomed to mass media advertising, with its one-way flow of communication. Digital adverting however will be led by the consumers; they will more or less have full control of the information that they wish to receive and the format will look nothing like traditional advertising. It will be highly personal and highly interactive. Mass advertising will not disappear. There are still good reasons for it to continue, but over time its role will be eroded. The trend will be the democratisation of advertising, necessitated by changing consumer behaviour in favour of the digital media. For more information, see chapter 2.1, page 16.

We are seeing the emergence of new advertising models as the industry gains confidence; driven primarily by the phenomenal growth in online advertising revenues. Online advertising formats can involve searching, games, online directory listings and other permission-based models. Video-based services on broadband and interactive digital TV networks are also becoming a whole new area for advertising opportunities. Social networks have also gained much attention in recent years, but in 2008 questions are beginning to be asked about the true potential of advertising over this medium. Personalised media and one-to-one communication will be the predominant mode on the Digital Media. For more information, see chapter 1.1, page 1.

Location Based Advertising has had a revival with the development of Location Based Services over mobile devices. Put simply, LBA is when advertisements are strategically communicated based on a consumer’s location. Mobile LBA is slowly becoming a reality with services starting to roll out around the world, particularly in North America, Europe and Asia Pacific. In addition to the marketers, major players in the mobile and Internet fields are also taking great interest in these developments. For more information, see chapter 2.3, page 30.

This report provides an insight and analysis into the trends and developments taking place in Digital Media in terms of advertising and marketing. The report comprises a global overview of marketing and advertising developments, including advertising statistics. It includes information on marketing strategies such as permission and location based marketing. Developments and statistics at a regional level are also provided for North America, Latin America, Europe, Middle East, Africa and Asia Pacific. The report contains BuddeComm’s analyses of the current market and the future for marketing and advertising in the digital media era.

Key highlights:

  • The biggest growth in advertising for the next ten years will come from digital media and this will most certainly involve massive changes for the traditional ad agencies. For more information, see chapter 1.1, page 1.
  • It is expected that by 2015, 65% of all New Media revenues will be based on permission-based marketing. For more information, see chapter 2.2, page 26.
  • The online advertising market stalled during the dotcom era, but a significant recovery began in 2003 and today online advertising is flourishing with over $60 billion to be spent worldwide in 2008. For more information, see chapter 1.1.2, page 2.
  • A reflection of the growing digital advertising market has been the growth in Internet advertising across Europe, which is taking an increasing share of total advertising spend. For more information, see chapter 5.3, page 67.
  • Four of the major Internet media companies in the US capture over 60% of US online advertising revenues. For more information, see chapter 1.1.2, page 2.
  • In South Africa, Vodacom has started selling text ads to be placed on the 20 million free ‘Please Call Me’ SMS that are sent through its mobile network every day. For more information, see chapter 5.4.1, page 67.
  • There is a small but fast-growing band of new digital marketing houses in Australia who are promoting their ability to deliver an end-to-end solution. For more information, see chapter 5.6.1, page 75.

Data in this report is the latest available at the time of preparation and may not be for the current year.

Table of Contents

  • 1. Digital Media and Advertising
    • 1.1 Digital media – advertising overview, statistics & forecasts
      • 1.1.1 Digital media advertising analysis
      • 1.1.2 Global advertising statistics
      • 1.1.3 Internet advertising
      • 1.1.4 New media advertising
      • 1.1.5 Mobile advertising
      • 1.1.6 TV advertising to struggle
      • 1.1.7 Dubious advertising tactics
  • 2. Digital Media Marketing Strategies
    • 2.1 Marketing strategies
      • 2.1.1 Introduction: the changing role of marketing due to digital media
      • 2.1.2 Internet companies taking over the bat
      • 2.1.3 Simultaneous media users
      • 2.1.4 The key drivers of growth
      • 2.1.5 The role of service providers
      • 2.1.6 Customer loyalty
      • 2.1.7 Permission-based marketing
      • 2.1.8 Advertising
    • 2.2 Permission-based marketing
      • 2.2.1 Permission based: 65% of residential New Media market by 2015
      • 2.2.2 Banners and SPAM are the Ford T-models
      • 2.2.3 Permission-based marketing
      • 2.2.4 Customer Relationship Management (CRM)
    • 2.3 Location-based marketing
      • 2.3.1 Global Navigation Satellite Systems (GNSS)
      • 2.3.2 Location-Based Services (LBS)
      • 2.3.3 Global Positioning System (GPS)
  • 3. The Media Industry
    • 3.1 Digital media and the media industry
      • 3.1.1 Introduction
      • 3.1.2 Continental shift in competition
      • 3.1.3 Distinct industry realignments
      • 3.1.4 TV broadcasters
      • 3.1.5 Radio broadcasters
      • 3.1.6 Newspaper publishers
      • 3.1.7 The video and DVD rental companies
  • 4. Internet Media Companies
    • 4.1 Digital media and Internet companies
      • 4.1.1 Introduction and analyses
      • 4.1.2 Internet media companies
      • 4.1.3 Key areas for Internet media companies
      • 4.1.4 Search services seen as central
      • 4.1.5 Case study – Google, the leader
      • 4.1.6 Key developments
    • 4.2 Net neutrality analysis
      • 4.2.1 Introduction
      • 4.2.2 Network neutrality – a global issue
      • 4.2.3 Carriers in competition with content providers
      • 4.2.4 Network neutrality and non-discrimination
      • 4.2.5 Developments in the USA
      • 4.2.6 No-one owns the Internet
  • 5. Regional Overviews
    • 5.1 North America
    • 5.2 Latin America
      • 5.2.1 Overview
      • 5.2.2 E-commerce
    • 5.3 Europe
    • 5.4 Africa/Middle East
      • 5.4.1 Africa
      • 5.4.2 Middle East
    • 5.5 Asia
      • 5.5.1 Market overview
      • 5.5.2 China
      • 5.5.3 Hong Kong
      • 5.5.4 Japan
      • 5.5.5 Taiwan
      • 5.5.6 South Korea
      • 5.5.7 India
      • 5.5.8 Singapore
      • 5.5.9 Malaysia
      • 5.5.10 Thailand
    • 5.6 Pacific region
      • 5.6.1 Australia
      • 5.6.2 New Zealand
  • 6. Glossary of Abbreviations
  • Table 1 – Worldwide spending on convergent platforms by consumers – 2006; 2011
  • Table 2 – Global advertising market revenue – 2007; 2012
  • Table 3 – Global online advertising spend – 2007; 2010
  • Table 4 – USA online advertising spend – 2000 - 2007
  • Table 5 – Percentage of total US online advertising spending – top four portals – 2006 - 2007
  • Table 6 – Worldwide Internet users – 1990 - 2008
  • Table 7 – Global interactive advertising revenue – 2007; 2012
  • Table 8 – Global online game advertising spend – 2007 - 2008; 2012
  • Table 9 – Global social networking advertising spend – 2006 - 2008; 2011
  • Table 10 – Online users and other media
  • Table 11 – Worldwide LBS revenue – 2007; 2013
  • Table 12 – Worldwide LBS subscribers – 2011
  • Table 13 – Worldwide market share of mobile phones equipped with GPS – 2006 - 2009
  • Table 14 – Search engine worldwide market share – early 2008
  • Table 15 – Online search market share – top 4 search engines in the US – Jan - Dec 2007
  • Table 16 – Revenue market share of total US online advertising spend – Google, Yahoo, AOL, Microsoft MSN – 2006 - 2007
  • Table 17 – US online advertising revenues and market shares – 2007
  • Table 18 – Online advertising revenue and forecasts – 2005 - 2010
  • Table 19 – Market shares key online advertising markets – 2005 - 2006; 2010
  • Table 20 – Market shares by major players – 2005 - 2006
  • Exhibit 1 – Digital media marketing commandments
  • Exhibit 2 – Anarchy Online by Funcom
  • Exhibit 3 – Why mobile marketing won’t work
  • Exhibit 4 – Telecommunication convergence
  • Exhibit 5 – Banner ads
  • Exhibit 6 – Permission-based business model
  • Exhibit 7 – Early adopters
  • Exhibit 8 – Examples of LBS services on mobile phones
  • Exhibit 9 – Assisted GPS (A-GPS)
  • Exhibit 10 – Location Based Systems (LBS) applications by market division
  • Exhibit 11 –GPS applications and industry use
  • Exhibit 12 – Examples of leading Internet media companies
  • Exhibit 13 – Key areas of focus for Internet media companies
  • Exhibit 14 – Internet media companies – alliance/merger examples
  • Exhibit 15 – Implications of ending net neutrality
  • Exhibit 16 – Key digital media advertising companies
  • Exhibit 17 – Why mobile marketing won’t work

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Digital Media
Strategies & Analyses (Industry & Markets)

Number of pages 98

Status Archived

Last updated 29 Apr 2008
Update History

Analyst: Stephen McNamara

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