IBM: The End Of Advertising As We Know It

ibm.jpgIBM released an interesting new report earlier this week that predicts the end of advertising as we know it within 5 years.

To quote IBM

Traditional advertising players risk major revenue declines as budgets shift rapidly to new, interactive formats, which are expected to grow at nearly five times that of traditional advertising. To survive in this new reality, broadcasters must change their mass audience mind-set to cater to niche consumer segments, and distributors need to deliver targeted, interactive advertising for a range of multimedia devices. Advertising agencies must experiment creatively, become brokers of consumer insights, and guide allocation of advertising dollars amid exploding choices. All players must adapt to a world where advertising inventory is increasingly bought and sold in open exchanges vs. traditional channels…

The report observes four change drivers tipping the advertising industry balance of power:” control of attention, creativity, measurement, and advertising inventories.” Consumers’ attention has shifted, with personal Internet time rivaling TV time. Consumers have tired of interruption advertising, and are increasingly in control of how they interact, filter, distribute, and consume their content, and associated advertising messages. IBM’s survey findings demonstrated that half of DVR owners watch 50 percent or more of programming on re-play, and that traditional video advertising doesn’t translate online: 40 percent of respondents found ads during an online video segment more annoying than any other format. Amateurs and semi-professionals are increasingly creating low cost advertising content that threatens to bypass creative agencies, while publishers and broadcasters are broadening their own creative roles. Advertisers are demanding accountability and more specific individual consumer measurements across advertising platforms. Self-service advertising exchanges are attracting revenues that were once exclusively sold through proprietary channels or transactions.

The Full report here (pdf) makes for interesting reading, particularly for anyone working in an advertising related business. A lot of it states what many of us already know, but it doesn’t hurt to have this validated in writing.

(via Slashdot)