Agencies lament lack of high-flying skills to make online ads soar
22nd August 2006

 

A thin talent pool, rather than a lack of interest, is the biggest factor holding back the development of online marketing in Australia. Facilitate Digital CEO Ian Lowe says blossoming demand has created a shortage of people with the skills and experience to create and manage a professional online campaign.

 

"There is so much desire to 'gear up' in the digital space (that) we can't generate the talent quickly enough, " Mr Lowe says. "We might be growing at 60 per cent but it could be 160 per cent."

The numbers may bear out Mr Lowe's theory. The growth of online advertising is slowing slightly, according to a report distributed last week by the Audit Bureau of Verification Services, which found online advertising revenue grew by 59.4 per cent to $778 million over the past financial year.

 

In the previous financial year it grew by 60.1 per cent, and in the 2003-04 year it grew by 64 per cent.

The finance industry is the top spender across all advertising categories, although recruitment is the top money-spinner for online classifieds.

 

But Mr Lowe says most publishers and media agencies could double their growth if they could find all the resources they require.

 

"Digital media spending is exceeding radio - it's a going concern," Mr Lowe says. "This demand is coming from the very top of the food stream, the advertiser. They have recognised the value. There is not a single media agency in this country that doesn't have a fully ramped appetite for gearing up their digital media capabilities."

 

Many agencies, however, cannot find enough talent to fuel the growth. "On the publisher side, the agency side - everyone is growing and looking to hire someone, sales reps and media buyers, but the talent pool is very shallow because the growth is outpacing how quickly we can develop the talent to service it," Mr Lowe says.

 

It is not only an Australian problem. Facilitate Digital is about to expand into Europe, where it says there is a voracious appetite for the tools it is selling to track the production and delivery of online campaigns.

 

Mr Lowe says the arrival of digital media as a force in advertising has changed the ways campaigns are measured. Standard performance-based scales measuring the reach and frequency of advertising are being joined by measurements that focus on business results with real cash values attached, such as conversion rates, cost-per-click and cost-per-acquisition. He says these can be used to challenge digital advertising sceptics. "We have never had these figures for any other media," he says. "I find it ironic when certain people jump up and say response rates are low in online advertising - compared to what? Response rates in TV? We don't have that number. Online we have business metrics that tell advertisers whether they are making money. And clients have been voting with their dollars."

 

But there are still challenges to be overcome, Mr Lowe says. One is the complexity of the online world. "If I'm buying TV, there are probably four or five different units of time that I can buy, from a sponsorship grab to a 60-second commercial," he says. "If I'm buying online, there would be more than 100 units I can buy. The specification of the TV content is essentially identical. For each of the 200-odd websites in Australia where I can buy these 100-plus formats, every single one of them is different."

 

By Nick Miller
© 2006 Copyright John Fairfax Holdings Limited.
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