A Message from M9 to All of You!

» A Message from M9 to All of You!
» Internet Advertising
» Manitoba Jobs Increase in October
» Internet Purchases Increasing

Merry Christmas, Happy Holidays and we wish you a Great New Year!

From,

Roger, Bo, Ian, Aaron and Michael

Normally one of the first things that are cut during a recession is a business's advertising budget. For example, between 2000 and 2002 (the dotcom crash), online advertising in the United States alone fell by 27%.

However the internet has changed considerably since then. Right now most businesses are seeing internet advertising as a cost of sales. And some see advertising as an extra return on investment for something they'd have to have anyway.

That attitude means that many companies are increasing their internet advertising budget because it brings sales at a relatively low cost.

For example:

• In the United States, currently experiencing a catastrophic financial meltdown, a recent report by eMarketer revealed that online advertising spending will increase by 8.9% in 2009
• In Canada a report by Price Waterhouse Cooper, indicates that the internet advertising market will expand by at least 19.8% each year

The reason the budgets are increasing is because modern internet advertising can increase both brand awareness and consideration while appealing to customer preference, all at the same time.

That flexibility means that internet advertising can be extremely effective!

The Changing Face of Advertising

According to eMarketer the amount of money spent on online advertising in the United States increased by 21.4% in the category of search (such as the M9 search engine optimizing Content Generation Solution and Optimization of Website Sub-Structure Solution) and 11.3% in the category of e-mail (such as the M9 Client Subscription Solution) in 2008.

Over the same period the money declined by 7.2% in the category of sponsorships and 5.5% in the category of classifieds.

Basically the old ways of advertising on the internet - banner ads for example - are less and less significant to the overall picture.

The Future of Internet Advertising

Right now videos are one of the hottest categories in internet advertising. The amount of money spent on video in internet marketing increased dramatically in 2007 to roughly $2 billion (USD) (don't worry, M9 can help with videos as well).

However the increase in video still does not compare to the amount spent on search advertising; in 2007 the amount spent on search totalled $11 billion (USD)!

And companies pay for internet advertising, even during a recession, because it works.

In October the unemployment rate went up by 0.1% to 6.2% across Canada. However, according to Stats Can records (Statistics Canada at http://www.statcan.ca/menu-en.htm); the nation's overall employment has increased by 1.2% during the first 10 months of 2008.

That increase translates to an extra 203,000 jobs added to the economy, both full and part-time, in 2007 over the same ten months 338,000 jobs were created. In October this year much of the growth came from hiring for the Federal election when about 40,000 people were hired for the short term.

The Greatest Increase

Across Canada Alberta has the lowest unemployment rate at 3.7% in 2008 and an additional 15,000 jobs were created in October. So far this year Alberta's employment growth has been 2.2% which is considerably lower than the 3.5% growth they experienced in the first ten months of 2007.

In Manitoba

Manitoba (which had a population of 1,186,386 as of 1 June 2007, http://www.gov.mb.ca/health/population/parttwo.pdf (pdf)) has a workforce of 607,200 in October (compared to 606,800 in September) with 494,800 working full time and 112,400 working part-time.

The unemployment rate for Manitoba is 4.3% which compares favourably to the national rate of 6.2%.

In addition the Conference Board of Canada has forecasted that the province will have a real Gross Domestic Product (GDP) growth of 2.7% in 2008 and 2.4% in 2009. In terms of comparison that means that Manitoba will be number two nationally in 2008 (behind Saskatchewan's 5.2% GDP) and number three in 2009 (behind Saskatchewan's 3.6% and Alberta's 2.6%).

According to the Board ". . . the province is in good shape; a strong domestic economy and large construction projects will allow for sound economic growth in the near term."

In 2007 Canadians used the internet to purchase $12.8 billion worth of goods and services, a 61% cash value increase since 2005.

According to Statistics Canada the volume of orders rose from 49.4 million to 69.9 million over the same period in 2005 with 52% of the orders being placed with Canadian vendors.

In total more than 8.4 million Canadians made an online purchase in 2007 (out of the estimated 19 million internet users), up by 1.5 million from 2005 (when there were almost 17 million users).

Additionally 82% paid online directly compared to 75% in 2005 and in 2007 the value of their average purchase increased by $23.00 to $183.00.

The Biggest Concern

The biggest concern of consumers online was about the security of their credit cards. In total 50% of all Canadians (online and not online) were concerned about online credit card use. The percentage dropped to 34% of those who had actually made an online order.

That indicates that the more Canadians use the internet the more comfortable they are using the internet.

Some of the most common purchases included travel services, books, entertainment products and clothing. When the average age of the majority of internet shoppers (25-34) is considered, this makes sense as the purchasing fits in exactly with their normal practices.

"Window Shopping" in the Internet Age

For many Canadians the internet is used to supplement traditional shopping practices by allowing extensive research to be done quickly and easily. In 2007 43% of Canadians researched a product on the internet and 64% then made a purchase from a brick and mortar store.

Some of the most popular items researched include clothing, electronics and house wares of all types.