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Study: Companies Favoring Content Over Ads

Consumers' rejection of online ads have marketers rethinking how they spend their money 3/25/2016 11:56:00 AM Eastern

Click-through rates on banner ads have already hit rock bottom, 94% of online viewers skip pre-roll ads before five seconds have gone by, and an estimated 12% of display ads are never even seen by humans, translating into $18.5 billion in ad spend waste in 2015, according to a new report.

That all ads up to brands rethinking how they spend online, with an increasing shift in money going toward content, instead of advertising, according to a report by analyst Rebecca Lieb for content marketing software company ScribbleLive. Her report (“The Eclipse of Online Ads”) combined recent statistics on the effectiveness of online ads and the input of more than a dozen top marketers, including MasterCard, Marriott and Visa.

“With advertising effectiveness on the decline, practitioners are turning to other forms of marketing to better engage customers during their digital journey,” Lieb wrote. “Content marketing, and its underlying content strategy, has emerged as the savior in the new marketing hierarchy as leaders seek alternatives to paid media cohorts that no longer produce tangible business results.”

Consumers just subconsciously ignore digital advertising, with an estimated 60% unable to recall banner ads they’re exposed to, according to the report, another reason 51% of B2B marketers and roughly the same number of B2C markets are going to increase their content marketing budgets this year, according to a report from the Content Marketing Institute.

Because consumers are simply mistrustful of online ads (with 30% saying they don’t find online ads effective and 54% saying banner ads don’t work at all, according to an Adobe report), the marketers Lieb spoke with said they’re increasingly looking toward social platforms, sponsorships and especially mobile.

“As screens and devices proliferate, together with growth of in-store beacons and near-field sensors, marketers are beginning to lean heavily on real-time messaging in owned and earned channels,” the report reads. “The ability to swiftly respond to events and triggers is critical to capitalizing on sporadic consumer behaviors.”

For more information on the report, click here.

(Photo via Ervins Strauhmanis's FlickrImage taken on Sept. 19, 2014 and used per Creative Commons 2.0 license. The photo was cropped to fit 3x4 aspect ratio.)

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