AGENCY 2003: New Media Agency of the Year - Best of the rest

Danny Meadows-Klue, chief executive of the Interactive Advertising Bureau (IAB), believes that in 2003 online re-emerged from the gloom of the advertising slump and came of age as a marketing medium.

To support this, he says online's share of total advertising spend will have increased from 1.4% at the end of 2002 to 2% by the end of this year, valued at nearly £300m.

Leading the recovery has been an influx of major advertisers such as GlaxoSmithKline and Wilkinson Sword, which are starting to pledge a sizeable portion of their advertising budgets to the internet.

"We have seen a wholesale shift; online advertising is no longer being driven by young dotcom businesses advertising through each other. Mature, traditional brands are using online as part of their marketing mix," says Meadows-Klue.

The main attraction for advertisers seems to be the growing maturity of the medium. More than half of the UK population is now online. Five thousand new users log on every day and by the end of November, the three millionth broadband customer had been connected.

As a result of this mass acceptance of the internet, online is no longer regarded as an anomaly but as a medium in its own right, as the number of pitches and new business wins over the past 12 months reflects.

Fru Hazlitt, managing director of Yahoo! UK, believes that 2003 has proved to be a turning point, with major advertiser McDonald's announcing that it is cutting TV spend to focus more on online advertising. "Until now, the internet has been too specialist; it needs to be part of the overall marketing strategy of major advertisers," she says. "Things are changing, and we're starting to be recognised as the sixth advertising medium."

Last year's New Media Agency of the Year, Agency Republic, has had another outstanding year. It continues to lead the way for O2 on the web, and figures revealed to Marketing show O2 has significantly scaled up its online investment on the back of creative and media planning and buying work done by the agency.

In 2003, Agency Republic claims that as a direct result of extensive online marketing activity, O2 sold more than 434,000 mobile phones online, equating to more than £150m in annual revenue. It has also picked up clients including BBC World Service, Oxfam and ebookers.

Zentropy Partners, Agency of the Year in 2001, has prospered once again, winning 15 clients. Revenue has grown by more than 16%, while the agency has increased in headcount and bolstered its reputation as one of the leading online advertising specialists.

Arnold Interactive has added high-profile activity including site development for Samsung UK, online advertising for the National Lottery and all the online advertising for the Sky Plus integrated £20m autumn campaign.

Meanwhile, AKQA's clout with US giants such as Nike and Microsoft cannot be understated. It has also been active in new business, picking up eight clients, including the online advertising accounts for Yell.com and Nikon Europe.

A number of site-build specialists have had a strong year, most notably Agency.com, which was appointed BT's lead digital agency of record.

Full-service agencies including Profero and Wheel have benefited in both advertising and media terms. Wheel has established itself as a leading online marketing specialist, having integrated Abel and Baker, while Profero has demonstrated its full-service status, signing up Tesco, Singapore Airlines and Lufthansa.

Business is booming for online media specialists. I-level has furthered its reputation as the industry leader with another good year. Highlights include securing a place on the COI Communications roster, worth £6m, and picking up eight clients, including Goldfish and Zurich Insurance.

This means i-level is responsible for buying digital media for the two biggest spenders online in the UK: COI Communications and BT.

Away from the internet, the feel-good factor is also present on other interactive platforms. The growth of interactive TV advertising continues apace, with industry leader Sky claiming to have run more than 300 campaigns in the past two years.

Mobile marketing has begun to establish itself as an advertising medium in its own right. The leaders in the field, Flytxt and Aerodeon, have enjoyed impressive years working with such prestigious brands as Procter & Gamble, Ford and Emap.

Online is well placed for growth, with advertisers keen to take advantage of its uses both as a brand-building and direct response medium.

"Clients are clearer about the role of the web for their businesses, addressing the user experience and investing greater marketing spend in online marketing, having seen the value it brings," says Juliet Blackburn, head of digital at the AAR.

This year, the IAB appointed former ITV chief executive Richard Eyre to lead the internet's efforts to become accepted as a true advertising medium. The onus now lies with the advertising agencies to fortify this position.

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