At Procter & Gamble Co.'s FAST summit last month , consultancy McKinsey & Co. predicted Internet advertising will be a $25 billion industry within the next 10 years.
For that to happen, the control and disbursement of ad budgets has to change dramatically.
Flat banners, contests, sponsorships and pop-up windows aren't going to make the Internet a multibillion-dollar advertising market. This is an industry searching for a way to make it into the big time.
At a FAST summit panel discussion, one Internet agency executive noted his employees are rewarded based on the unique ideas they execute on behalf of their clients.
In reality, those ideas generally translate into one-off programs (one-time campaigns) that not all sites can accept; burn a lot of development time and financial resources; and are rarely the types of projects advertisers reinvest in.
On the positive side, these programs draw the attention of potential new business to the agency and increase the perceived value of the agency for mergers and acquisitions.
But in the long term, will all this help the Internet advertising market rival the TV and radio markets in terms of advertising revenue? Not likely.
The Internet has response, gives users access to more information, accomplishes branding and shortens sales cycles. The only thing that has been missing is the power of emotion that is seen or heard on TV and radio. Until recently, that is.
The solution is simple: Bring TV and radio commercials to the Internet.
Accomplishing this may require a fundamental change in the way media is planned and bought; then again, it may not.
Currently, advertising is created in terms of the hardware it is viewed from -- radio, TV or PC. The challenge is to think of the opportunity in broader terms. The payoff could be huge for smart advertisers because it makes their expensive creative investment work smarter.
CLICKABLE TV, RADIO ADS
What if an advertiser could easily run its radio and TV campaigns on the Internet today? What if its traditional media department could do all the buying without having to know one thing about Internet advertising? Should we have clickable/interactive TV and radio ads on the Internet in addition to banners?
Yes, absolutely. They are quite possibly the banner's ultimate replacement.
Rich media is the answer, specifically streaming rich media.
It offers the ease of using existing creative. It makes it simple to deliver audio and video messages to Internet audiences.
Rich media is the underleveraged asset of the Internet today and one to which those that produce TV and radio commercials can quickly adapt. That's the future of our business.
Jeff Lehman is VP-sales at RealNetworks, a streaming media company based in Seattle.
Copyright September 1998, Crain Communications Inc.