Rich Media Rising

Many of you know the Internet Advertising Bureau (IAB) just updated issued its guidelines for rich media advertising on the Web. The guidelines apply to in-page ad units, such as the Universal Ad Package introduced last year. The IAB plans to follow a similar path for audio-and-video, over-the-page, rollover, and expandable units. The new guidelines have already been adopted by AOL, MSN, Yahoo, and 36 other Internet companies, including portals, ad networks, and rich media suppliers.

The new guidelines differ from the old mainly because they simplify advertising standards. Many ad units’ recommended file sizes were increased as well. Some advertisers believe their approval of larger creative files is in response to continued broadband adoption, which facilitates use of rich media that loads in real time. Regardless of motivation, it’s a development sure to please the many marketers still struggling to fit their messages into a measly 10-15k format.

The IAB also made some key conclusions after examining issues as media buyer needs, user acceptance of ad units, ad effectiveness, and publisher requirements. One conclusion, based on buyer, agency, and sales team feedback, is “traditional buttons and banners have limited value.”

Is it just me, or does all this suggest rich media is poised to become the star of online advertising?

Though rich media can’t be hailed as a flawless medium (not all consumers appreciate it, and some marketers’ refusal to employ frequency caps only made matters worse), lavish attention of late has done wonders to improve its social standing. Spending on rich media advertising is up, in spite of alleged concerns about return on investment (ROI) and production costs.

Surely, something more tangible must be propelling rich media forward. What’s at the root of the industry’s conviction? Let’s look at the facts:

• According to a DoubleClick report outlining Q4 2003 results, online advertising conversions were highest for rich media units (they also accounted for nearly 40 percent of all ads the company served).
• The same report stated the rate of post-impression sales resulting from rich media ads was 2.3 percent, compared with 1.47 percent for non-rich ads.
• Those top site publishers have steadily increased the amount of rich media advertising they offer for years. They control about 65 percent of all Internet advertising inventory. If the trend continues, non-rich ad selection could be very limited (DoubleClick says the number of standard banner and button ads it serves is already in a slow decline).

Marketers are likely to remember this when planning campaigns and determining which ad formats (rich or non-rich) to employ. Sure, that same DoubleClick report showed declining CTRs on rich media ads. But it also said those rates were still over five times higher than the average CTR on standard ads.

Such data can be persuasive to buyers after branding power and results. Couple this with the easy implementation the new standards afford, and rich media seems virtually unstoppable.

This isn’t to say media buyers should allocate all client budgets to rich media. As always, the determining factor in choosing an ad format should be client and campaign objectives. Rich media may not always be appropriate.

But in light of recent history, a changing online landscape, and efforts from publishers and trade organizations to smooth the medium’s progress, it seems our affair with rich media is only beginning.

Just remember, don’t be blinded by the love!