Interactive’s New Year, Part 2

Last year may (really) turn out to be the one in which the slump ended. Smith Barney analyst Lanny Baker last month predicted a 20 to 25 percent increase in online ad spending for 2004, and Jupiter Research puts next year’s online ad expenditure at $7.6 billion, up 21 percent over its 2003 projections. (Jupiter Research is a division of this publication’s parent company.)

In the spirit of looking ahead, we’ve asked seven luminaries from different categories of interactive marketing to share their forecasts for 2004. Three online marketing brains weighed in yesterday. Today, four more share their perspectives.

4. The wireless perspective: Jonathon Linner, CEO of Enpocket

In the wireless space, although we haven’t been producing as much news, I think we’re doing about five times our projections right now. For the first time in the U.S., we’re turning down business. Right now, my expectation is that the U.S. will surpass the U.K. by mid-2004.

We’ve seen some of major campaigns start in the U.S. A lot of marketers and carriers have had issues with executing these campaigns, in terms of infrastructure. But by the middle of next year, you’ll see quite a lot of on-pack promotions — especially things that appeal to the under-35 set — and many scratch-and-win promos will happen via text. It’s evident to us that this’ll be really big by next Summer.

The other thing you’re going to see is the continued growth of text incorporated into television and outdoor media. The sponsor of a show may extend its sponsorship to hit people between shows and build a direct relationship with consumers. We’ve done a number of these in Europe, and the response has been very positive. The TV network, the sponsoring brand, and the consumer all get a big boost from it.

We still have a lot of room to improve in the allocation of short codes, compared to the U.K., where you can get a short code in a matter of days or hours.

5. The agency perspective: Jeff Lanctot, VP of Media for Avenue A

The industry is going to see the power of personalization. We’ve long been talk about targeting and delivering the right message at right time. In ’04, the industry will, broadly speaking, figure it out. It’ll really be the year of personalization.

I think the power of MSN and Yahoo will continue to grow. They’ve emerged as two of the most powerful opportunities in media. As bellwethers in the industry, that’s good for all publishers.

Publisher will claim to have run out of online inventory, and this time around they won’t be lying. That’s an overly cute way of saying there is strong demand to meet inventory they have.

I think video will have its day in the sun. We’ve inched toward online video being an important part of digital media, but we haven’t quite gotten there. A combination of broadband and quality of product may converge to make it happen.

The question is no longer should I be online, but how should I be online? That’s a good sign; we don’t need to justify our existence anymore. And now that people have recognized it as a vital part of the media mix, they’re getting more intelligent about it. They’re not planning it in a vacuum. Marketers in general are asking really smart questions about the impact of their advertising dollars.

On the negative side, I think some of the pre-crash arrogance is returning among a small handful of publishers. They’re once bitten, but apparently not twice shy. They tasted a modest comeback in 2003, and a small portion are entering 2004 with some irrational hubris. The one thing I’m concerned about is that we don’t get ahead of ourselves.

6. The rich media perspective: Jules Gardner, CEO of PointRoll

2003 legitimized Internet advertising after it was cut off at the knees in 2000, so I predict 2004 will be a major growth year. A lot of the internal fighting about whether Internet advertising works will be swallowed up by the reality that it’s all about the impression and about building on the impression. Online does that extremely well.

I think there’s going to be much more focus on page-based ads this year. We’ll see an acknowledgement that what’s on the page matters, as does the quasi-subliminal message of the ad in the content. The advertiser will put more emphasis on that now.

Also, you’ll see real graphical ads on search pages.

7. The desktop perspective: Avi Naider, CEO of WhenU

We’re seeing tremendous interest in desktop advertising. The whole notion companies can reach consumers through software apps is here to stay. It’s becoming a larger component of advertiser budgets.

Due to our conservative approach to desktop advertising, WhenU has had less overall legal wrangling than others in the space. It’s worked out well for us, and we anticipate the industry will move toward accepting us.

Also, we’ve seen some negativity expressed toward pop-ups as a format. It’s critical adveritising in general, and particularly desktop marketing, offer a broad array of approaches to the advertiser. We want to remove some of the associations consumers and advertisers have with pop-ups. For example, we’ve modified our approach to include Unicast and Eyeblaster-like formats. We’re turning the computer into a multimedia advertising environment.

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