Many small businesses may now choose to try to grow their businesses by advertising in a number of ways, and for some that might include some commercials that run on television. However, this might not be the wisest investment these days, as online video advertising is becoming extremely effective as well, and might carry a cost that's far less significant.
In the age of DVRs that allow consumers to fast forward through commercials during their favorite TV shows, ads on that medium might be losing a little bit of their effectiveness, according to a new report from eMarketer. About 75 percent of advertising agency executives in the U.S. now believe that online ads are equally, or even more, effective than those on television, and only 17 percent think they're less effective. Meanwhile, 91 percent believe they're better than display ads at drawing in potential customers.
Further, those executives also tend to believe online videos are more effective than social media and search advertising, with 68 and 52 percent, respectively, responding in this way, the report said. Only direct response ads were considered to be equally or more effective by fewer than half of those polled, with just 45 percent considering them to be such, compared with 31 percent who felt they were less so.
Indeed, the number of executives who expected to see online and mobile video advertising account for their largest growth in the near future came to 25 and 23 percent, respectively, the report said. In all, it's believed that this type of advertising in particular could see spending among businesses nationwide expand by some 41.4 percent over the course of 2013, rising to a total of $4.1 billion nationwide. At the same time, though, just 6 percent of executives said they expected to see the biggest growth among television commercials, compared with 25 percent who thought this type of advertising would have the lowest growth in spending among companies.
For these reasons, as businesses try to become more successful by reaching a larger potential customer base, advertising costs are something they should consider carefully. However, other costs, such as small business insurance policies, can also be prohibitive to expansion efforts. For this reason, it might be wise for owners to investigate whether they are paying more than they need to for coverage such as general liability insurance.