Online Publishers Expect Branding Growth in 2006

Online publishers are expecting more revenue from brand-focused advertisers, and are turning to more sophisticated kinds of ads to attract and support them, according to a survey by AOL’s Advertising.com.

“Last year, publishers were saying they wanted to do all these things, but they had resource restraints that prevented them. This year, they’re still saying that it can be difficult, but it’s worth it because of the revenue that will come in as a result,” Lauren Weinberg, research director at Advertising.com, told ClickZ News

In its third annual Interactive Publisher Survey, Advertising.com gathered feedback from its network of publishers and found that they were expecting 32 percent of revenue to come from “traditional” advertisers, those whose businesses and ad spending are predominantly focused offline. That’s up from 26 percent last year.

The objective of these traditional advertisers is often brand-building, as illustrated by the publishers’ responses that over 40 percent of revenue would come from advertising campaigns with branding objectives, more than double last year’s 19 percent figure. Direct response still represents the majority of online spending, but its 58-percent share was down from last year’s 80-percent share reported by publishers.

The study found publishers who earn over 25 percent of their revenue from traditional advertisers are more likely to support more branding-focused ad formats, including rich media and pre- and post-roll video ads, as well as larger banner ad formats such as leaderboards and large rectangles.

They’re also more likely to support behavioral targeting, which may indicate this more sophisticated type of advertising appeals more to traditional marketers who are familiar with the concept in offline campaigns.

For publishers who earn less than 25 percent of their revenue from traditional advertisers, text links and small rectangles are more common revenue drivers, and direct response was more often the goal.

Compared to last year, contextual text ads saw the most overall growth in adoption, with 67 percent of publishers now supporting them, an increase of 30 percent over last year. Text ads are also expected to continue as the most profitable ad unit for publishers, followed by standard banner ads and large rectangles, though more growth is expected in revenue from leaderboards, skyscrapers and small rectangle ad units.

Over 76 percent of publishers support rich media, up from 69 percent in 2005; and 35 percent support video, as opposed to 25 percent in 2005. Roughly 30 percent employ behavioral targeting versus 25 percent last year. Pop-ups are on the decline for the first time in three years and aren’t expected to be profitable.