If you are an account rep trying to get online travel companies to buy display ads on your website, these are not the best of times.
Display advertising in the U.S. from online travel services fell 46.4% to $35.66 million in the first six months of 2010, compared with the first half of 2009, according to Kantar Media.
Kamtar Media doesn’t track search advertising, but its says overall online travel services ad spend on TV, radio, outdoor, newspaper, magazine and display dropped 22.3% to $162.74 million in the first half of 2010.
Declines occurred in radio (44.2%), newspapers (29.6%), magazines (60.3%) and display ads (46.4%).
The only upbeat developments in the categories that Kantar Media tracks were TV and outdoor ads, which rose 8.9% and 2785.5%, respectively.
TV advertising by online travel services in the first half of 2010 came in at $92.53 million, dwarfing the $35.66 million spent on display advertising. So TV is king, at least when measured against display ads.
Outdoor advertising by online travel services was $1.58 million in the first six months of 2010, up from just $792,000 a year earlier.
So, what’s going on here?
It is well-known that major online travel companies cut back on their marketing this year, and display ads may have taken the brunt of the hit in online advertising.
Dana Hayes, chief revenue officer at Travel Ad Network, which sells advertising on 300 travel websites, says “performance/ROI advertisers were very metric driven” in the first half of 2010.
That means they may have favored search advertising over display and print advertising, and cut back in outlets where performance wasn’t up to par.
“It’s really a math, metric, quant game that is going on,” Hayes says.
That being said, Hayes surmises that Kantar’s numbers for online travel services’ display-ad buys appear to be “very negative numbers.”
Kantar declined to explain its methodology, reserving such information for clients.
While Kantar’s numbers related only to online travel services’ display-ad buys, Hayes says Travel Ad Network’s revenue from rental car companies and cruise lines increased 100% in the first half of 2010 while other travel categories were flat to slightly up.
Travel Ad Network deals primarily in the display ad side of the business.
“For the first half of 2010, we found that travel marketers still support trusted digital brands with unique offerings or ROI marketers focused on highly targeted audiences,” Hayes says.
Hayes adds that Travel Ad Network’s revenue rose 40% in the first six months of 2010.
Meanwhile, the sober display ad numbers from online travel services occur as Yahoo revealed it would buy Dapper, a move designed to help Yahoo bolster its display advertising lead over search-ad-king Google.
Dapper’s sweet spot is contextual display ads and technologies.
Google, in turn, sees its initiatives to boost its relatively small display ad business as a strategic imperative.
Both Yahoo and Google undoubtedly hope that online travel companies kick into gear their display advertising in the second half of 2010.
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On one hand, it would be interesting to know how PPC search, non-search PPC, CPA and other online direct response dollars stack up as well.
I think the general understanding is most travel advertisers have prioritized spending within channels that drive immediate, accountable transactions, largely at the expense of branding-oriented objectives.
On the other hand, I think (and hope) we’ll be seeing a giant leap in the display ad creative product that could resuscitate this spending dip.
The combination of social graph / micro-behavioral targeting with a blend of video + text will cause the standard .gif banner to become even more of a dinosaur.
Yes, this has been claimed for years, but it’s beginning to happen within FB already and once FB’s 3rd party network rolls out it will occur with even greater prominence.
Looks like the advertisers are getting smarter and diverting their dollars to pay per performance areas.
It would be interesting to see trends in affiliate marketing also.
All the best,
Ewen
useful article
Good to know because I have been over at CJ trying to figure out what ads to place on my site. Maybe I should look into more cruise and rental car ads!
Thanks, great article.
The current trend of distributing valued content away from web sites and into custom content areas such as RSS, mobile and Social Media is exceeding search engine referral audiences.
Add insult to injury, the smart marketers whom push content to their audiences in these channels are also double-dipping because they enjoy the additional benefit of increased natural search optimizations on search engine result pages.
-bob sacco
co-founder of Travel Ad Network