What’s 2007 Generating?

We’re all rolling back to the office in a new year (some more slowly than others). If only I could come up with a way to run a lead-gen company from the Florida Keys. They have Internet access and you can work remotely, plus there are rocking waterfront bars — distractions aplenty!

So what we can expect from the coming year?

You don’t have to be a rocket scientist to know search will continue to soar. Interactive advertising has posted eight consecutive quarters of growth, with Q3 2006 reaching a record $4.2 billion. Search has the lion’s share of the action. Unless someone quickly invents a way to reach hundreds of millions of consumers who are glued to computer screens day in and day out, seeking information, we’ll all be talking Google for a long time to come.

For co-registration companies that buy keywords to drive traffic to their sites, media are getting more expensive. Many of these companies are almost priced out of the market. We buy a lot of keywords, and it’s a double-edged sword. Our maximum price has risen exponentially to be where we want to be, and vastly more people are searching for the keywords on which we bid. They in turn click more, so we’re spending a lot more on a monthly basis. This trend will continue as advertisers clamor for more avenues in which they can generate customers. They’ve been buying search (so expensive) and affiliate marketing. Now they’re reaching out to co-registration/online lead generation. This holds true for business-to-business (B2B), business-to-consumer (B2C), and what I call business-to-professional (B2P) companies.

This will be the year co-registration/online lead generation comes of age. We saw a bunch of the shadiest characters forced to change their ways in ’06, and of course we’ll have to deal with them in ’07 as well, but to a lesser extent. My sense is some big players will see lead generation’s value from both a publisher and an advertiser perspective. This will further legitimize the space and take it to the next level: publishers will generate more customers for their clients and achieve higher effective CPMs (define) than other forms of advertising — when done correctly.

What else to expect this year? Late 2006 brought some interesting stats on what Americans do most online. According to Mediamark Research, the biggest growth year-to-year in Internet activities came via using blogs, watching online videos, and making Web phone calls. Blogs are everywhere in the mainstream media, YouTube hatched a few mega-millionaires, and you can’t turn on the tube without seeing a Vonage spot (will the blonde ever get eaten by the “dolphins”?). These three activities are just beginning a long, steady climb that will attract evermore advertisers. Less than 7 percent of U.S. adults visited a blog last year, and under 3 percent made an online phone call. There’s nowhere to go but up.

Finally, the Online Lead Generation Association (OLGA), just marked its first full year as an industry body. Expect best practice standards in the lead generation space very soon. Response to OLGA has been quite gratifying, and some major companies have made commitments to our group through both membership dues and volunteerism. A year ago, when we were about to launch OLGA, we met with Greg Stuart, who was leading the Interactive Advertising Bureau (IAB) at the time. He cautioned us that running a trade association with no paid staff and no administrative help would be a big chore. Greg, you were right, but it’s been worth all the effort. I’ll be reaching out shortly to some of you readers as OLGA takes its next steps forward.

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