May 9 2011
Basis Team

Four Reasons to Invest in Digital


Consumers spend more time with digital vs. traditional media. Digital is magnetic. In the last five years, internet usage has risen by 121%, while offline channels (TV) either declined or remained constant. Key contributors to this growth include increased usage of mobile and social media as well as a shift to more online shopping experiences (nearly two-thirds of consumers shopped online in 2010).

Consumers rely on multiple digital media channels. PCs, tablets, smartphones and more! Today, consumers are taking in content through multiple digital channels, often simultaneously:- Time spent with mobile devices is rising faster than all other media. In 2010, consumers spent 28.2% more time with mobile devices. Social networks account for nearly two-thirds (64%) of the online population. eMarketer forecasts that 21% of US mobile phone users will be regular social network users in 2011. Online video experiences have shown a surge in usage. U.S. users spent almost 45% more time viewing online video in January 2011 vs. January 2010. Additionally, the mobile video audience increased by 40% in Q4 2010.

Ad dollars’ shift online to follow consumer behavior. The economy will not keep advertisers down. Online ad spending in 2010 rose by 13.9%, reaching a record $25.8 billion. It will continue to reach new peaks in the coming years, passing $30 billion in 2012 and $40 billion in 2014. This growth is attributed to online reliability, especially during the economic downturn, along with an increased investment in video and display. In fact, display spending is expected to surpass the growth rate of paid search through 2014. This growth is driven by the rise in video, banner ads and brand dollars vs. direct response alone.

Ad dollars are underutilized in the digital space. Opportunity knocks! While more dollars are shifting online, they have yet to catch up with consumer behavior. This represents an underutilization of ad dollars and an opportunity to get in front of more consumers. According to eMarketer, the internet took up 25.2% of adults’ daily media time in 2010, but received just 18.7% of US ad spending, which represents a gap of 6.5 percentage points. What does this all mean? The digital space offers endless opportunities for engaged consumers and creative advertisers to interact with each other. What are your thoughts on the evolving digital space?