Online advertising is being billed for big growth. And not without reason

There has never been any doubt about the potential of online advertising and survey results published by a research firm has more or less confirmed that. Taking Europe as a sample for survey, Forrester’s has found that up to a fifth of advertising spending in that region will be online by 2012.

It is hard to imagine that online advertising might grow to such proportions but the signs have always been there. The survey said 16 billion Euros will be spent on ads in Europe in 2012 and 18 per cent of that will go online.

Another interesting facet of the survey was the trend it found among Internet users.

It is said that 52 per cent people were now online regularly and that meant their time watching television was reduced. And the number of hours spent online has surpassed the time spent watching T.V. and reading.

One of the signs that indicated that the online ad pie was getting creamier was when Google purchased the online advertising firm DoubleClick in April for $3.1 billion. And that was closely followed by Microsoft acquiring a digital marketing firm aQuantive for $6 billion. If that was not enough, there were the whispers of Yahoo! being taken over by Microsoft. And the rumours still refuse to die down.

Online advertisements have moved on from the time where they were those flashy things on webpages.

Pretty soon it was realised that it was a different ball game online. Rather than conventional advertising that went mass, online ads had to be targeted.

DoubleClick did exactly that, putting the right flashy ads at the right places. Then there is of course Google which made its market capital from just targeted text-based ads.

North America and Europe might be the bastion for online revenue now, but the future is India and China — two countries that one day will become the most populous online communities.

The heat is on to tap these markets. Yahoo! India recently said it trebled its ad-revenue from India and every one wants to launch India-specific sites.

India and China also find themselves with a population that is exposed to a variety of vibrant media such as print, television, Internet and cutting-edge telephony.

Google has already tried linking radio and print ads in the U.S. with its Internet arm and the potential for such integration here is enormous.

The Forrester survey did throw up a whammy though. There is still no clue as to how effective online ads are, as more than two-thirds of European net users feel they are not trustworthy.

ANAND SANKAR

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