Online Advertising Set For Boom In New Zealand

"A new study by Jupiter Communications predicts that by 2005, every Internet user will be exposed to more than 950 marketing messages each day.

Leading the pack will be large offline companies, which are expected to provide the bulk of the expected $16.5 billion in spending by 2005. The financial services field will be the biggest spenders among online companies, with an anticipated $2.4 billion by 2005, up from $70 million in 1999.

To differentiate their messages, online advertisers will need to move beyond banner ads," says Jupiter. "This will include branching into e-mail marketing, viral campaigns, affiliate networks and sponsorship." The diversification should lead to a more rational approach to attracting customers: "

Over the past two years, we have seen overheated offline advertising spending by access, commerce and content companies that were willing, even eager, to pay hundreds of dollars to acquire new customers, seemingly without regard for the lifetime value of the customers," says a senior analyst with Jupiter." (E-Commerce Times, August, 2000).

According to Paul Hashfield, Media Director of Brave New World, there is growing evidence that the trend is moving the same way in New Zealand.

* 3 out of the top 4 current New Zealand online advertising spenders
are financial companies - ASB / ANZ / Eloan.
* NZ Banks are now realising they can make huge savings in transaction
costs if they have customers banking online.
Traditional branch banking costs several dollars per transaction,
online a several cents a transaction.
* Jupiter predicts that by 2002, 10% of mortgages in USA will be
applied for online...representing hundreds of millions
of dollars a year if this happens in New Zealand.
* While banners are still growing and currently make up 85% of New
Zealand online advertising, the % of banners to
other ways of online marketing such as Sponsorships, Rich Media
(Interactive TV, WAP phone messages delivered
by the Internet) and pop up windows, should equal the revenue spent on
banners within 3 years time.

Given this moving trend towards online campaigns, Paul predicts that NZ organisations will continually need to be smart in designing and delivering messages to their targeted audience:

* As the Internet user will be exposed to an increasing number of
messages a day, the challenge will be to make sure
messages are in a relevant context so that consumers find the
message relevant to their needs.
* It is important to remember that the rules of marketing success are
the same as they are with traditional media...
relevant targeting, a good call to action and clarity in
communicating that call to action.

For further information, please contact:
Paul Hashfield, Brave New World, tel: +64 9 355 1787, mob: 021 383 860,
email: paulh@bravenewworld.co.nz
Nimita Morarji, Botica Conroy & Associates, tel: +64 9 303 3862, mob:
021
950058, email: nimitam@bca.co.nz > > >

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