Although about 90% of clients of the agencies surveyed have a home page on the Internet, only 39% do other types of marketing and advertising online.
"About eight months ago there was a wave of Internet solution provider companies that sprung up to provide Web sites to Fortune 500 companies," said Mike Rinzel, a senior analyst at Jupiter Communications, New York.
"But now," he continued, "it's time for marketers to get more than their toes wet, and many don't have the resources to do that."
"You would hope technology companies would be the most aggressive in implementing interactive media, but the agencies don't feel like they're any more aggressive than other companies," said Peter Zandan, IntelliQuest CEO.
When asked which media deliver the best return on investment, interactive media was chosen by only three of the agencies, or 4%.
Even worse, when answering which media was most effective in promoting their client's brand, only 1% chose interactive media.
But strangely, 88% of those surveyed agreed that interactive media is at least a somewhat-if not very-valuable part of a marketing mix. And 44% feel that their clients should be moving faster toward utilizing interactive media.
"The value is to be there [online or the Internet] now because it's almost embarrassing not to be," said Brian Sharples, IntelliQuest president.
Part of the problem marketers face when figuring out interactive media is that traditional tools like traffic measurement, ratings tracking and security devices used to evaluate media in general have yet to be accepted for interactive media.
"Marketers shouldn't move more quickly into online advertising because there are still so many unanswered questions regarding overall efficiency," said Ellen Freeman, chairman-CEO of Freeman Associates Inc., a Wellesley, Mass.-based agency that focuses on direct response media for clients including PowerSoft Corp., Concord, Mass., and America Online, Vienna, Va., both of which currently use interactive media.
"Marketers need to justify the time and expense involved in being online. You can't just dive off a high dive without knowing where you'll land."
Many industry executives liken interactive advertising to the once-burgeoning cable industry.
"Cable hasn't always had the penetration and measurement it does today, yet it still contributes to the real bread and butter of media schedules," said Ms. Freeman. "Interactive media is now in its infancy stage, and people need to let it grow up a little bit."
When it comes to interactive advertising, two-fifths of the agencies surveyed think their operation is at par with other agencies, while a nearly equal number believe they're more advanced. Just one-fifth feel they are behind other agencies.
"Interactive advertising is about educating yourselves and educating your clients about opportunities," said Ann Balboa, media director at Lutat & Battey, Campbell, Calif. "No one comes to us and says put together an interactive ad program. We spend time online and learn about the industry, and go to our clients with our pitches."
As far as educating themselves about interactive advertising, a shocking 29% of those questioned admitted they don't spend any time online-either on the Internet or a commercial service-during a given week. Less than half spend five hours or more online a week.
"It's really up to us to explore what's out there," said Aric Hooverson, a senior account exec at Austin, Texas-based T3, which does work for Dell Computer Corp. and other high tech marketers. "Many people don't understand how the marketing world fits into interactive. We'll figure out what fits and what doesn't over the course of this next year."
Of the clients that have a home page, only 39% also advertise on other online sites.
"Many marketers jumped on the Web because they thought that was the thing to do, without thinking how it would work within an overall strategy," said Richard Fusco, VP-marketing and business development at Next Century Media, a New Paltz, N.Y.-based technology consultancy.
To better understand how to integrate interactive into an overall marketing strategy, most consultants suggest sticking with the more traditional agencies that can farm out technical production work as necessary.
"Traditional agencies understand the concept of integrated marketing and brand building," said Mr. Fusco. "The start-up Web companies don't know much about how creative works with media, or have the clout that agencies have when it comes to buying media."
Nearly three in five of the agencies surveyed said their clients are working with them to develop interactive advertising; more than one-quarter have contracted with another company for help.
"Seems that every marketer has a Web site because small Web developer companies are mushrooming everywhere," said Mr. Rinzel.
"Right now technical expertise is at a premium, but once technology is ubiquitous, the deal-making and image-manufacturing that traditional agencies do so well will once again be at a premium," he said.