In a study by The Yankee Group, the collective marketing budgets of all online advertisers is expected to reach $50 billion by the year 2011, which would be double what it is today.

The internet accounts for approximately 20% of total media consumption today. The Yankee Group expects that number to increase by 5% in the next three years, so a great share of the expected additional ad revenue will come from new, improved methods of marketing and a better understanding of which social media marketing approaches are most effective.

The study also makes a few other predicitons, including their belief that search engine marketing is only going to keep increasing in relevance. Also, the so-called “dancing cowboy” animated ads aren’t about to hit the road quite yet.

Others, like Paul Glazowski at Mashable, believe the group’s predictions aren’t optimisitic enough. Currently, internet advertising accounts for about 7.5% of total marketing budgets and the Yankee Group prediciton would only put that number at 15%. It’s not implausable to think that with the explosive growth in social media that the number won’t be closer to 20%, which would put the total online advertising expense in the $65-70 billion range.

Glazowski doesn’t believe that there will be more online ads, just that they will be in much bigger demand and will thus cost more. The argument is that the front page of popular website can be entirely populated with ads, but the ads that are there can attain a greater stature and a bigger price tag.

This entry was posted on Saturday, January 19th, 2008 at 2:01 pmand is filed under Business, Search Engine Marketing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.