- Pepsi’s online ad budget has gone from 1% of total ad spending to 5%-10% in five years
- General Mills expects to double online ad spending in the current year
- Kraft plans to double online campaigns in 2006, and increase by 50% the number of brands it advertises online
- Anheuser-Busch’s online ad spending will double in 2006, hitting 5% of the total ad budget
To put it in context, packaged goods companies accounted for 11% of the 145-billion U.S. ad market in 2005 — but they spent just 1.6% of the ad money online last year. There is, to paraphrase the Google uber-bull case, a lot of room for a major ad-dollar budget shift. A lot of a lot of room.
The number of monthly visitors to each site rose at rates ranging from 185 percent (Citysearch) to 528 percent (Blogger.com) between February 2005 and February 2006. Their growth far exceeded the 4 percent increase in overall Internet visitors in the United States during that period. The traffic analysis shows the Internet is still a space where new brands such as MySpace can suddenly break into the upper ranks, where older brands such as Citysearch can revive themselves after languishing for years, and where established outfits such as Google often wind up as beneficiaries because they buy or copy services pioneered by upstarts.
For many teens, hanging out has moved online. Teens chat on IM for hours, mostly keeping each other company and sharing entertaining cultural tidbits from the web and thoughts of the day. The same is true on MySpace, only in a much more public way. MySpace is both the location of hanging out and the cultural glue itself. MySpace and IM have become critical tools for teens to maintain “full-time always-on intimate communities” where they keep their friends close even when they’re physically separated. Such ongoing intimacy and shared cultural context allows youth to solidify their social groups.