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Why Advertisers Are Afraid of the Web
Despite all the excitement about how fast the online advertising market is growing, it’s still a drop in the bucket – 5% – of the total advertising pie.
According to a McKinsey survey, it turns out that among 410 marketing executives who advertising online, 52% said there are “insufficient metrics to measure impact”, while 41% said there weren’t enough in-house capabilities, 33% said they had difficult convincing senior management. 24% said they are a limited reach of digital tools, while 18% said there are insufficient capabilities at ad agencies.
Scott Karp does a fine job ripping apart these arguments. In typical fashion, he provides this succinct summary:
“The reality is that the attitudes expressed in the McKinsey report are all a smoke screen, intended to protect vested interests and organizations adapted to static media models, which went unchanged for decades, and not the dynamic innovation of the web. But they can’t deny that the future of advertising and marketing is online. that traditional advertisers are looking for more accountability but more “comfortable,†more “familiar.†Just ask media companies how uncomfortable the transition to digital can be.”
Karp hits the nail on the head. You’ve got a huge industry with billions of dollars to spend on advertising. Not surprisingly, they will spend on what they know – traditional advertising – as opposed to taking a “risk” and allocating more of their budgets online. Even an aggressive online advertisers such as P&G, which spends close to $100-milliononline, still has the vast majority of its ad budget in traditional media.
It won’t be until the next generation of media buying executives appear on the scene that you will start to see seismic changes in the ad industry. These people will be Web savvy and not afraid to put some serious dollars online. Until then, most companies will dabble with the Web until they and their media buyers are sure the Web is ready for them.