How Many Banners Does Six Billion Bucks Buy?

 There was an interesting article in Adweek today. It said that spending in the online channel reached an amazing $6 billion in the fourth quarter of 2007. That’s a surge of 25% over Q4 in 2006. I don’t yet have any facts to back this up, but based on my own experience and observation, I am pretty sure that a decent percentage of this increase is coming from Consumer Packaged Goods marketers.

There are a number of reasons for this. First of all, it is now undeniable that reaching a target market using traditional channels is less cost-effective than ever (And this will only get worse until the TV networks roll back their pricing—they continue to charge more every year while providing less. Does anyone understand this?).  

Second, it is increasingly clear that marketers can use the online channel to reach consumers in numbers that rival traditional mass media. For example, Glam and iVillage now receive nearly 20 million visitors every month, and the major portals provide massive reach. 

And third, CPG companies are learning that, in addition to being the best method ever invented for deepening engagement with potential consumers, the online space is also really, really good at increasing baseline product awareness and purchase intent.  

I believe we will look back on 2007 as the year things changed for good. That it was the year that the internet finally took a place at the adult table, and turned out to be the best-dressed guest there.