Believe it or not, it was not that many years ago that many types of businesses questioned whether or not they should even be online.
Now the question seems so last-century.
"Business-to-business (B2B) marketing has undergone significant changes in the last several years," says Lisa Phillips, eMarketer senior analyst and the author the new B2B Marketing Online: Trends and Tactics report. "Spending on advertising and marketing has regained the momentum lost in 2000 and 2001, and the Internet is causing shifts in advertising and marketing strategies among businesses of all sizes."
Although trade magazines and business publications will maintain a leading share of B2B advertising for the foreseeable future, online spending in the B2B category will hit $2.4 billion next year, up 23.7%, according to Veronis Suhler Stevenson (VSS). Growth rates will increase by double-digit percentages through 2010, while spending on older media, particularly magazines, will decelerate.
"The b-to-b guys have been behind the curve on digital spending, but everyone realizes that their future success — and very survival — depends on adopting integrated marketing online strategies," Tom Kemp of VSS told Media Business magazine.
"The Internet is now an integral part of doing business for US businesses, large and small," says Ms. Phillips. "Virtually all, 98%, of the 220 manufacturers surveyed by SVM e-Business Solutions have a Website, and 87% have had one for over three years. More than half, 52%, consider their site to be their most powerful marketing tool."
While B2B online advertising only grew 5% in 2005, local newspapers and consumer magazines saw declines in B2B spending, down 4.7% and 0.4%, respectively. Network TV spending increased by 4.8%, to $1.49 billion, and cable TV networks, in sixth place, saw a healthy 15.9% growth, to $1.12 billion.
What online ad formats are the dollars shifting to?
"Results for the first half of the year, released by the Internet Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC), show that search advertising still makes up 40% of all online ad revenues, while classified and referrals/lead generation each posted share gains of two percentage points, to 20% and 8%, respectively, compared to the first half of 2005," says Ms. Phillips. "The gains are impressive, considering that online ad revenues grew 37%, to $7.9 billion, for the first six months of this year. For example, revenues from lead generation actually increased 82.4%, to $633 million from $347 million in 2005. By contrast, display ads, which include rich media, banner ads, sponsorships and slotting fees, lost three percentage points in share of total, but spending still increased 28.6%, to $2.5 billion."
Measured by online ad impressions, the business category is definitely putting more money online. Between March and April 2006, B2B online ad impressions rose 6.86%, to 7.5 billion, according to Nielsen//NetRatings.
"According to the Direct Marketing Association," says Ms. Phillips, "by 2008 online marketing efforts will be the dominant medium for B2B initiatives."