Banner ads that are designed to drive traffic to sites are to
account for less than half of total online spending in the next three
years, according to International and Media Worldwide, Modem Media
president John Nardone.
Speaking at the IAA/MEDIA Summit in Hong Kong, Mr Nardone presented his
top 10 predictions for the Internet in the next three years.
He said the majority of online ad spending would come from "rich media,
interstitials, sponsorships, integrated content and service at the point
of delivery" as markets and clients demanded more thought, insight and
creativity from agencies.
Mr Nardone also predicted an end to the ongoing debate between the
Internet as a branding or direct response medium.
"There will be wide recognition of a new model: That the Internet is one
of the most important drivers of brands by delivering valuable services
and user experiences as the 'proof points' for the underlying brand
promises.
Few companies will manage to emulate Cisco and create a huge competitive
advantage by using the Internet as a unified enterprise business
platform, Mr Nardone said.
"They will manage all digital channels as one coordinated eco-system for
acquiring and managing customers, including corporate homepages,
intranets, extranets, email, sponsorship and wireless. The other 85 per
cent of companies will continue to use these channels separately and
realise only 50 per cent of their possible return for their efforts," he
said.
While Mr Nardone said he expected wireless applications to thrive, he
forecast a grim future for wireless advertising, referring to its
expected return as "insignificant".
For all its hype, Mr Nardone also shot down interactive TV because he
did not believe the industry would see "any meaningful or widely
available interactivity on TV" in the next three years.
He added that aggregated "personal portals" would emerge as the most
powerful trend online and would force marketers into collaborative value
exchange relationships with customers, adding, "marketers who fail in
this regard will be disintermediated from their customers".
Contrary to the general negative market forecasts for
business-to-consumer (B2C) companies, Mr Nardone said he expected many
B2C companies to succeed on two premises.
"That they deliver services that consumers truly want and need, and that
they market those services through disciplined targetted efforts, with
heavy emphasis on digital media channels."
Meanwhile, online business-to-business (B2B) was expected to emerge as
a whole new discipline, separate from exchanges or supply chain
linkages.
In addition, according to Mr Nardone, it will be online trade journals
that will "become syndicators of content, providing the environments
that will enable even the smallest companies to manage customer
relationships and maximise returns".
For companies neglecting to incorporate technology and the Web, he said
their fate would be sealed, as "every major company will have a standing
e-committee, dedicated e-organisation or have an otherwise coordinated
effort to transform the enterprise ... or will be on their way to being
out of business."
