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CPG Internet MarketingProduct Type: Market Research ReportPublished by: eMarketer Published: December 2004 Product Code: R203-349 Description The CPG Internet Marketing report analyzes the evolving environment of advertising online. To the surprise of many industry experts and pundits, the online world is becoming brand-friendly.
The change could not come at a better time. With today's fragmented consumer audience, the traditional mass-market tactics of CPG companies are increasingly under fire, yet the need to capture awareness and establish the brand remains the same. As more consumers spend more time online-and use the medium to shop and make critical purchase decisions-brand managers must solve the puzzle of how to pitch online. And the executives at leading CPGs are hard at work doing just that. When ad spending grows faster than net sales-as it did for Procter & Gamble in the fiscal year ending 2004, with spending rising 25.9% versus 18.5% for sales-you know something is going on behind the scenes. A/B ad tests are being conducted. Marketing models are being constructed. ROI tools are being built. The report covers all the new tactics and techniques CPG marketers are employing. Questions the Report Answers:
Total Media Spending To put online ad spending into context, just as CPG advertising makes up a small share of online advertising, the Internet represents only a tiny component of the CPG media mix compared with television and magazines. According to Deutsche Bank's analysis of the "100 Leading National Advertisers" report from Advertising Age, $3.9 billion of all CPG ad budgets went to network (aka, broadcast) TV in 2003, while $1.9 billion went to cable TV networks. Note, however, that broadcast TV spending inched up by only 3% versus 2002, but CPG ad spending on cable jumped by 21%. What CPG advertisers gain in cable over broadcast is not unlike what the Internet offers: the ability to target messages to an audience based on factors such as demographics and interests. With the Internet's additional targeting capabilities, such as by an individual's behavior or registered preferences on a content or brand Web site, there's good reason why online ad spending by all CPGs rose by 15% in 2003. However, that $137 million for Internet advertising represented a mere 1% of CPG ad budgets for measured media spending. Total media ad spending among the 23 leading CPGs among Ad Age's top 100 tends to follow company size, at least among the top three: Procter & Gamble, Unilever, and Altria. The greatest ad spending growth came from Kellogg's (at 32.8%), Mars Inc. (at 24.5%), and P&G (at 24.3%). However, the growth rate for 2003's total media spending was unevenly distributed. While eight CPGs boosted spending more than the average gain of 4.2%, 13 companies actually decreased ad spending compared to 2002's figures. And, compared to the 9.0% growth among the entire leading 100 group, even that 4.2% average gain indicates some pulling back among CPG advertisers. Table of Contents Please Note: Due to the brevity and/or nature of the content posted, there is no table of contents available for this report. |
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