European Online Ad Budgets Climbing Despite Recession

Seventy percent of European advertisers are increasing their online spend during 2009, according to research by the European Interactive Advertisers Association (EIAA).

The trade body’s annual Internet Ad Barometer report, which questions 300 global brands such as Procter & Gamble, Sony and Ford, suggests this growth will continue throughout the year, and that only 8 percent of respondents have reduced their online spend in 2009 so far.

As a result of the current economic climate, this increased online spend is achieved primarily at the expense of traditional media, the report says. Thirty-seven percent of the advertisers questioned claimed budgets were being reallocated from TV, 32 percent from newspapers, and 46 percent from magazines.

Alison Fennah, executive director of the EIAA, attributed these shifts to the relative transparency online ad formats can offer. “With every media investment closely scrutinized by brands, and a renewed focus on return on investment, online comes into its own as the most effective way of providing accountability for marketers,” she commented.

The research also suggests online is playing a more central role in overall ad strategies, with 47 percent of advertisers regarding online solutions as “an essential factor within the marketing mix,” up from 38 percent in last year’s research. Additionally, 16 percent of advertisers now claim to be allocating larger budgets to pan-regional campaigns, rather than country specific ones, perhaps in attempt to maximize efficiency. This figure was up from 11 percent doing so in 2008.

In terms of formats and tools, 64 percent of advertisers said they had increased their paid search investments, with e-mail, display and video advertising also proving popular. Almost a third of advertisers (30 percent) said they were currently making use of mobile formats within their overall strategies.

Responses were provided by marketers with responsibility for allocating media and advertising budgets in markets including the U.K., France, Germany, Italy, Spain, Netherlands, Belgium, Sweden, Norway, and the pan-European sector. Brands in the study represent a cross section of automotive, entertainment, travel, consumer electronics, fast moving consumer goods, telecommunications, finance and retail sectors.