14 June 2014: The blog referenced in this post, nzonlinemedia.blog.co.nz, appears to no longer exist.
10 Oct 2006: Sarah McDonald in the NBR reported on this today, and the Internet Bureau’s response will be in the NBR next week.
There’s a new “blog” in town. And while I ought to be delighted to see people prepared to debate online advertising models – and to do so online, in public – this blog seems a strange beast.
New Zealand Online Media attempts to blogify a position paper produced by executives from five advertising agencies. It is a blog in name only, containing only one posting, undated, that reads like a pitch. It’s a sort of blog-by-committee with the five authors’ names and email addresses noted in the sidebar. There’s even a posting headed “summary” – which is probably the last thing you’ll ever see on a genuine blog!
At least the authors are clear about their objectives, signalled in the site’s subtitle: “What’s wrong with New Zealand’s online media industry?”
The authors urge advertisers, publishers and agencies to move from a fixed-position model to cost-per-thousand, arguing that it is a better system for assessing the results of campaigns. Their description of the pros and cons of each system is clear and well-argued.
And they want to see ad-serving more widely used, in the interests of accountability and optimisation. Sounds reasonable to me.
Their third objective seems to be to persuade advertisers to avoid dealing with the long-established Internet Bureau, which books a large percentage of online expenditure in this country and which, they say, is too cosy with publishers. I can’t comment on that, but the IB is a dominant player and more competition would be a good thing, right?
What I like about the site is that it recognises the enormous potential for online advertising in New Zealand to increase its share of advertising spend.
A Roy Morgan poll says advertising agencies spent eight per cent of their NZ budgets online in the past year. The NZ Online Media group suggests the rate is only four per cent, putting it at less than half of Australia’s rate – although there is hot debate about just what each country’s numbers include, as one person noted in a comment on the Online Media site:
This paper is based on the purported fact that New Zealand is underperforming the rest of the world in terms of the Internets percentage share of adspend. I have never seen any figures produced that as yet give an accurate gauge of online advertising spend in New Zealand. This is true of display advertising which is traditionally the easiest to measure and the most readily supplied by online publishers to industry groups. No one has even pretended to offer a measure of the online search or classified markets in New Zealand. To start an intelligent debate on this subject requires you to at least understand the New Zealand market it is clear that is not the case. The first and only graph on the site is flawed. These other countries have a reliable measure (or more reliable) of advertising expenditure across the three main sectors, New Zealand has not. The total display, search and classified spend for New Zealand for 2005 was far in excess of the $44 million you are quoting, anyone who understands or works in this market knows this.
Search and classified definitely need to be included in the online advertising figures, but it’s pretty safe to say that online still offers a lot of untapped potential, especially given the metrics and accountability that advertisers can get from online campaigns.
As for it’s key arguments, the Online Media people say things are starting to change.
More and more inventory is being sold on a cost-per-thousand basis.
More clients are discovering the true accountability of the medium via adserving.
Agencies are beginning to look at the options of setting up in-house departments.
But their call to action needs work:
Have your say on the new Blog that covers the state of online media in NZ. Anonymous comments will be accepted, but it will be more constructive if you have the guts to put your name behind your point of view.
Hold on, none of the actual postings on this “blog” have been signed. (They’re presumably the joint work of the five executives.)
And the six comments currently published are all anonymous too. Must be a lot of people nervous about their jobs in this industry.