Fortune 500 Execs Unsteady with Online Advertising

Ad spending forecasts tell of a shift of budgets to the online channel pumping up growth in online expenditures. So it’s established that online is experiencing growth from organic spending and from dollars that used to be spent elsewhere. A survey released by the American Advertising Federation finds that while marketing and advertising commitments are increasingly being carried out on the Internet, execs at some of the larger companies are having trouble wrapping their head around how to best utilize the channel.

The Internet ad spend is expected to increase from 15 percent of the total media spend last year, to 20 percent this year, and 32 percent by 2010. The chunk taken up by search settles near or above the 50 percent mark for last year (9 percent); this year (11 percent); and 2010 (23 percent), TNS’s Steven Fredericks discussed when I spoke to him about the full-year forecast the company put out this morning.

The takeaway from the findings in the AAF survey is that 63 percent of respondents feel that Fortune 500 companies are “behind the curve” when it comes to an online ad strategy. Ninety-one percent of respondents feel the online media environment is a growth area for advertisers, and grants freedom to develop the medium, 29 percent are overwhelmed by the uncertainty of the medium. Further, those respondents are “hesitant to move ad dollars there,” the report said.

While the channel is developing, 58 percent are struggling to keep up with existing online efforts and not able to take action on what else online has to offer.

The larger corporations and brands that have succeeded with digital media campaigns include Burger King, Apple, Verizon, Volkswagen and Axe.