This is a fascinating article, that leads to all kinds of thoughts about the future.  At first glance though it makes sense.  I look at Bank sites in the UK, and they look like Las Vegas, or Times Square with flashing lights, and huge billboards. ( Take a look …  Barclays, Lloyds, HBOS ).  Then look at the American equivalents, and you see a much more conservative view ( Bank of America, Wells Fargo, Citibank )

The article points out that online ad spending as a percentage of budget in the UK, is double that of the US.

In the following year, Britain overtook the United States, and it has not looked back. In 2005, nearly 8 percent of British ad dollars went online, compared with 4.6 percent in the United States. And, this year, the two bureaus say, the Internet will account for 10.5 percent of British ad spending compared with 5.6 percent in the United States.

Source: The Future of Web Ads Is in Britain – New York Times

One key point is made at the start of the article, and that is the fractured market in the US, and I would think the fractured Banking space also contributes.  There are something like 7K banks in America, vs 4 big ones in the UK, and a few other brands, but many of those are owned by the big ones, such as Woolwich owned by Barclays. Anyhow the budgets are concentrated.

There are big differences between the advertising markets in Britain and the Unites States. In Britain, much of the advertising is national, while there are strong local and regional ad markets in America.

But there are more fundamental differences that support the differences too:

More than their American counterparts, British marketers seem to have bought into the oft-touted benefits of Internet advertising: that it is easy to track, enormously effective and a relative bargain. In Britain, as Internet ad spending surges, the overall advertising pie is not growing much at all, and traditional media are the ones losing out.

However, British media are nearly all aimed nationwide in contrast to the United States newspaper and television markets, where local and regional markets are big players. These local markets in the United States have, so far, been slow to move ad money online.

Big British advertisers have also been quick to jump at the opportunities provided by paid search advertising, like that sold by Google and other search engines. Search accounts for 56 percent of Internet ad spending in Britain, compared with 42.5 percent in the United States, according to the Internet Advertising Bureau. “We’re all searchaholics,” said Guy Phillipson, chief executive of the bureau’s branch in Britain.

And internet access types also contribute with broadband more supportive of flashy advertising:

Similarly, broadband access in Britain at first lagged access in the United States, but has since surged. In 2002, 15.7 percent of American households had broadband compared with only 5.1 percent of British homes, according to eMarketer. This year, Britain is ahead, with 47.4 percent of homes having broadband, which is more than the 43.9 percent in the United States.

Then there is the more experimental and liberal approach accepted by Brits compared to the conservative Americans.

Some analysts say British advertisers may simply be quicker to embrace new marketing ideas than American companies. “I’d like to think there’s a cultural factor in the U.K., where we’ve been a bit more experimental on some of these things,” said Rob Noss, European chief executive of MindShare Interaction, a new media division of Group M’s MindShare unit.

In the United States, major advertisers are more dependent on traditional media, particularly television. The top 50 advertisers in the United States spent just 3.8 percent of their budgets in the first half of this year on online ads, excluding search-related advertising like that sold by Google, according to data from TNS Media Intelligence.

In terms of Banks, and financial services, they have been particularly aggressive in the internet space.

In contrast, large advertisers in Britain appear to be leading the push onto the Internet. British financial-services companies have been particularly aggressive online spenders, in some cases allocating 30 percent or 40 percent of their advertising budgets to the Internet, Mr. Noss said.

This is a consequential shift relative to the US, with TV close to taking second place.

In Britain, analysts predict that it will not be long until Internet advertising catches up with TV advertising. Group M, for instance, says the Internet could account for 25 percent of British ad spending by 2010. That would place it ahead of television, which accounts for just more than 20 percent now.

But of all the stats, remarkable as they are, this one amazed me the most, namely internet usage hours.  UK is almost double their American counterparts, according to Citigroup.

On average, Britons spend 23 hours a week on the Internet, according to the Internet Advertising Bureau. The Internet accounts for about a quarter of Britons’ time spent with all media, according to Citigroup, nearly double the percentage in the United States. Americans use their computers an average of 14 hours a week, according to Nielsen Media Research.

For the final comment on this, I will go back to the first statement in the article.  Terry Semel of Yahoo seems to be working on the assumption all this is linear, and that the US is just behind UK. 

Still, some believe that online advertising in Britain provides somewhat of a roadmap for where online ads in the United States and elsewhere may be heading. “The U.S. is so behind,” said Terry S. Semel, the chief executive of Yahoo, in a recent speech in London. “It’s certainly lagging the U.K. by at least a year or two.”

Where does this leave us … I would not assume the US space will evolve exactly as the British experience.  If in fact the fundamentals are the root cause, the fracture markets, the fractured Banking system, then the logic that the American market will simply follow is flawed at best, and a dangerous assumption that could take marketers off track at worst.  Then layer in the natural conservatism that exists in North America (I include Canada) and a more plausible direction is unique evolutions in the respective markets.

I think the markets on either side of the Atlantic will evolve separately.  The only comparable will be closer alignment of internet usage – to me that’s a given.  But the extent and the way it is used is a different story, and the very differences we see so far in acceptance and usage of advertising is telling, and probably has implications for how social marketing might evolve.  That requires more thought, and for a future post.