Kevin Johnson described the market that Microsoft, Google and Yahoo! are vying for against traditional media when it comes to advertising.
Johnson, Microsoft’s co-president of the Platform and Services Division posted a graphic depicting $580 billion in global advertising spending during 2006. But the slice of the pie that the Internet companies are going after is currently pretty slim. Online advertising is projected to be $27 billion, or about 4.7 percent.
That leaves a lot of territory, especially given that desirable audiences are spending much more than 4.7 percent of their time consuming media online. Here’s where the rest of that money goes:
Print: $176 billion
Television: $151 billion
Directories and specialist media: $87 billion
Direct mail: $79 billion
Radio: $34 billion
Other: $26 billion
Microsoft’s chief ad man, Yusuf Mehdi, showed off progress on the company’s adCenter system.
Mehdi said adCenter, launched two months ago, has had its first $1 million day, ahead of the company’s internal schedule. He said the company’s goals for the product include expanding the inventory of advertising opportunities for sale through the system, including non-Microsoft properties; improving returns for advertisers; and attracting more advertisers to use the system.
He demonstrated how a cardiologist could build an online advertising campaign specifically targeting men age 25 to 50 who live in San Jose and surf the Web during the work week. “That’s something you can’t do in other systems,” Mehdi said.