The purpose of the experiential activities is to introduce you to specific tools

Question

The purpose of the experiential activities is to introduce you to specific tools and ideas that you can use along with
the theoretical knowledge gained in the course. Each activity will require you to complete an experience. After
completing the experience, you will be asked to write and submit a report discussing your findings and to ponder
the possible applications of the tools encountered. There is no minimum or maximum page requirement for an
experiential assignment. Your goal is to complete each experience and then write about it, according to the
directions from each activity.
For this activity, you will be researching the online advertising industry. Your goal is to discover the trend of online
ad spending for the last 3 years and a projection for the current year. You must find out how much money
advertisers have spent online in the affected years. Compare this to one of the traditional advertising outlets, such
as TV or newspaper advertising.

Steps
1. Research the advertising industry, with a focus on online advertising. Find out the size of the market and the
sales figures for at least 4 years.
2. Write a 2-page report in which you outline the spending trend and you compare the figures with those of TV or
newspaper advertising spending.
6. Submit your report in the course.

Explanation / Answer

Advertising Industry:

The Advertising Industry is the global industry of public relation and marketing companies, media services and advertising agencies. It is a global, multibillion-dollar business that connects manufacturers and consumers. The industry ranges from a very small firm with turnover of few crores to very big multinational companies with turnover of billions. Now-a-days, online advertising is used by most of the companies as the use of internet is increased manifold. So, let us discuss on this new form of advertising which is taking place of old advertising forms such as Television, Newspapers etc.

Online Advertising:

Online advertising is a form of marketing and advertising which uses internet to deliver promotional marketing messages to consumers. It is also called as online marketing or internet advertising or web advertising. It includes e-mail marketing, search engine marketing, social media marketing, display advertising (web banner advertising) and mobile adveritising. The size of this type of adveritising is growing day by day. It is speculated that the advertisers will spend approximately 40% of their budgets on online advertising in 2018, compared to 38% in last year. As on 2017, the online advertising industry is worth about 250 billion US dollars and looking after its growth, it is estimated that the said industry will worth 340 billion US dollars.

Sales Figures of Online Advertising Industry for 2014 to 2017:

Now, let us compare the figures of sales of online advertising for the years 2014 to 2017:

From above, it is clear that the advertisers are gradually increasing their expenditure towards online advertising. As mobile internet has become a household phenomenon, advertisers are relying more on online advertising as the advertising will reach to more and more consumers.

Comparison of Online Advertising with TV or Newspaper advertising:

The advertising field may seem different today than it was 50 years ago. Nowadays, businesses do not only have the opportunity to buy advertising in newspapers and on TV, but they can also turn on the internet as a viable advertising option. The internet has become a force to be reckoned with, in terms of competition for advertising dollars and has come out as the clear winner over newspapers and TVs, when it comes to where advertisin dollars are being spent. The key factors in favour of online advertising are cost, range and targeting.

Generally, advertising through internet is less expensive for advertiser than newspaper or TV. Further, the online advertising covers more range and target specific consumers in much parts of the world, than newspaper or TV. Further, from latest trends, it may be seen that the internet/online advertising is surging upwards as against newspaper or TV advertisement, which are showing downward trend, in which newspaper advertising is the biggest loser. The online advertising industry reached 230 billion US dollar in the year 2017 while that of TV reached 178 billion US dollar in the same year. The gap is expected to grow further in the subsequent years. The same is happening with newspaper advertising industry, as well and the fall is much steeper. Overall, global newspaper ad revenues declined by 21% during the past 5 years i.e. from 2013 to 2017 and the revenues of online advertising industry is increased by 28% in the span of last five years. Also, the advertising spending in newspaper has fallen by about 40% in the last five years. The ad spending on TV increased by 20% in the last five years and that on internet, it has increased exponentially.

From above discussion, it may be seen that the online advertising industry is flourishing these days and beating its rivals namely newspaper and TV media in all categories.

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