At eMarketer, we looked at the latest growth estimates for total US media spending among the leading analyst, media and research firms. Many of them point to reduced total spending, particularly in 2009. But given the recent economic fallout, all of these numbers are subject to change. [X OUT GRAPHIC] In fact, TNS, looking at measured media spending only, estimates total media growth declined 1.6% in the first half. But what do the marketers themselves have to say?
This kind of radical change is creating tumultuous upheaval for the entire media and marketing ecosystem, from publishers to marketers to agencies and technology vendors.
Distributed – consumer will grab content from whatever device is nearest (marketers will need to keep up with the consumer as she seamlessly shifts from one medium to the next) Personalized – likewise, advertising will become increasingly tailored to your interests, behaviors, purchases, etc. Contextualized – mobile provides a great example – location and time of day will factor into what kinds of ad messages are served
At 10%, that’s behind lawyers (18%), but just ahead of congressmen, car salesmen and telemarketers.
Think of three colleagues or friends in this room. If they’re okay, then it’s you!
When people open an app like Stanley level, they give it their full attention, and often tell others about it.
The Future of Media Geoffrey Ramsey CEO, Co-Founder
The Future of Media Geoffrey Ramsey CEO, Co-Founder
Glass half full, or half empty??? Media Spending Trends??? “ The only function of economic forecasting…” --John Kenneth Galbraith “ The real world won’t change for the better until 2010… when greed has overcome fear yet again.” --Sir Martin Sorrell, CEO, WPP
Media Spending Growth in the U.S. -14.6% Aug 2009 Study of 128 Marketers: 77% said they were cutting ad media spending 75% of US ad and media professionals expect to shift more than a quarter of their ad budgets away from traditional outlets over the next 5 years. (Jan ’09) -4.4% -10.6% July 2009 ZenithOptimedia 3.1% -12.3% Feb. 2009 UBS 4.2% -9.9% Feb. 2009 Oppenheimer & Co. 4.2% -15.4% Oct. 2009 Morgan Stanley -4.8% -13.3% March 2009 Myers Publishing -0.4% -15.5% July 2009 MAGNA -0.5% -14.6% Oct. 2009 eMarketer 1.0% -14.0% Jan. 2009 Cowen & Co. 5.0% -7.0% Jan. 2009 Citi Investment -2.6% -16.3% Oct. 2009 Carat Insight -0.3% -13.5% June 2009 Barclays Capital 2010 2009 Date
TELEVISION: BMO Capital…... -8.1% TNS (1 st Half)….. -10.0% VSS…………….. -10.1% Jack Myers…….. -10.4% UBS…………….. -11.1% Barclays………... -13.7% Oppenheimer….. -13.8% MAGNA………… -14.4% Traditional Media Growth (?) in 2009 RADIO: VSS……….….... -11.7% Wachovia……… -13.0% Zenith………….. -14.4% Barclays……….. -15.1% Oppenheimer…. -16.0% eMarketer……. -17.2% Jack Myers……. -18.4% MAGNA……….. -21.0% NEWSPAPERS: Zenith………… -15.0% eMarketer ……. -15.8% UBS…............... -17.6% Oppenheimer… -18.3% VSS…………… -18.7% Barclay’s……… -21.0% Jack Myers…… -22.5% MAGNA………. -29.5% Are we in in a cycle???
US online ad spending growth for 2009 Source: eMarketer, Oct 2009 Cowen (May ’09) - 6.0% - 5.0% UBS (Feb ’09) eMarketer (Oct ’09) -2.9% - 3.7% Morgan (Oct ’09) ??? Search...... +4.0% Banners…. -0.5% +5.9% growth in 2010 +6.6% growth in 2011 --eMarketer
55% of global marketing execs plan to cut spending on traditional media in order to fund increased online efforts (June 2008) 59% of U.S. marketers plan to increase budget for interactive by pulling funds out of traditional media (March 2009) 70% shifting media funds from traditional to digital media (June 2009) By 2012, online will reach $29 billion, or 17% of total media spending --eMarketer
US online ad spending in 2012 $28.8 ??? Mathematician John Von Neumann: “ There’s no sense in being precise when you don’t even know what you’re talking about.”
50% 50% “ We’re heading into a 50-50 world, where half of spending goes to digital and interactive campaigns” --Laura Desmond, Starcom MediaVest “ Over time, all ad money will go through a digital platform.” --Steve Ballmer, CEO, Microsoft “ In the long run, we’re all dead.” --John Maynard Keynes, economist
7 Implications for the Future of Media Rishad of Denuo: “ If parts of the company need to be blown up, you might as well get the bomb thrower to come from somewhere you know and trust.”
#1. Even post-recession, total media dollars will continue to shrink… Opposing forces
Accountability mandate will strengthen demand for lower cost, more efficient media
Media fragmentation will force marketers to target their messages to ever smaller, niche audiences
Digital technology creates new opportunities for self-marketing , e.g., via Web sites, online videos, Twitter, etc.
Inevitable shift towards “earned media” , as opposed to “paid media”
#2. Media will not only implode, it will also explode, becoming more:
Distributed – same content available in multiple locations, formats and media channels
Personalized – media will be tailored to reflect what you’ve watched/read/experienced/shared
Contextualized – when and where you get your information will dictate its content and format, and will, in turn, shape how you interact with and share it
#3. Proportionately, advertising will carry less and less of the load for media content Explosion of Media Advertising Pay for content “ Advertising simply cannot support all the media that out’s there.” --Wenda Millard Harris, (while at MSL) “ People reading news for free on the Web, that’s got to change.” --Rupert Murdoch “ We’re in a transition of what will be a proliferation of models, many of which will include getting more compensation from readers and users.” --Thomas Curley, CEO, Associated Press
All media owners need to ask the VALUE question... … what can we create that people will be willing to pay for???
Social media moms Rishad of Denuo: “ We are hungry for information and value those who do a superior job of editing the ocean of material there is.” “ We have a massive lost of trust.”
#4. Brands will struggle to engender trust In 2007, only 17% said they trusted advertisers By late 2008, only 10% rated advertising practitioners as honest Word Association – Describe Advertising : Source: Nielsen Online, 2008 “ FALSE”
Consumer TRUST Levels for Media Types -- Nielsen Online global survey, April 2009 -- 0% Opt-in email 55% Magazine ads 62% Editorial content 70% 100% Recos from people I know 92% Ads before movies 53% Mobile text ads 18% Search ads 37% TV & Radio ads 61% Banner ads 24% Brand sites 69% Source: Nielsen Online, April, 2009; n = 25,000 Newspaper ads 66% 8%? New Neurosis: Why 8% of Americans Don’t Trust Their Family and Friends Keller Fay Group: Consumers consider word-of-mouth as 2X as trustworthy as traditional media when choosing products
Figure out ways to earn and leverage the trust of communities that are relevant to your product or brand
Make your product and customer service as good as they can be (no more hiding!)
Emphasize listening over loud-speaking
“ I view listening as an important analytic. Listening and other analytics can drive your strategy at a macro-level... They can either reinforce your strategy or correct it.” --Michael Mendenhall, CMO, Hewlett-Packard Only 16% of U.S. marketing chiefs say their firms regularly monitor social forums … be transparent Transparency = Trust “ What about social media?”
#5. Social sites will never attract a large share of ad dollars 17% of Internet Time --Nielsen, 2009
“ 1 b illion dollars” Social “ad” spending will actually decline 3 % this year % of Marketers Planning to Boost Spending on Social Media in ‘09: Unisfair (Sept ’09)…………… 75% Reardon Smith (Jun ‘09)……. 69% Millward Brown (Apr ’09)……. 64% StrongMail (July ’09)………… 58% Forrester (2009)……………… 57% MarketingSherpa (Nov ’08)….. 48% Datran Media* (Jan ’09)…….. 44% ANA (May 2009)………………. 26% *Worldwide Forrester: While only 41% of marketers are placing ads on social networks, 64% say they’re building their own social media presence By 2011, ad spending will still be under $1.5 billion (eMarketer) Think less about buying social media, and more about how you can earn and own it!
Size of Audience Depth of Brand Interaction Widgets Video Sites Heavy Engagement # 6. Marketers will trade off reach to get a deeper engagement Apps Niche Social Sites “ [In the future, online media buying will be] about the re-aggregation of a fragmented audience that’s actually watching different things.” --Adam Gerber, Quantcast
#7. The classic interruption/disruption model of advertising will continue to erode… We interrupt this program to sell you stuff We interrupt this programming to sell you stuff! “ The way the world is headed is voluntary engagement . The work has to be a magnet.” --David Lubars, Chairman, BBDO North America
Downloaded 400,000 times “ Ads placed in front of searchers aren’t interruptions – they’re exactly what the searchers are after.” – Danny Sullivan, Search Guru at Large
Marketers will need to think less about grabbing attention , and more about capturing and measuring:
Intentions … serving messages based on the assumed intentions of each consumer.
Mentions … the things people say about your brand is more important than what you say.
Imaginations … your communications must be entertaining, useful, relevant and compelling enough to demand inherent interest…
“ The challenge is to build technological capabilities that allow you to see the complete digital footprint a customer leaves when they engage with your brand.” “ You’ll need advanced analytical tools so you can map ad strategies to audience behavior and deliver a range of appropriate campaign messages, in real time , to multiple devices, in multiple formats.” --Karin von Abrams, eMarketer analyst
IT’S TOUGH OUT THERE. You have 3 choices... The Skill The Till The Will 73% of marketers plan to increase marketing spending 3 – 6 months before the recession ends (to make sure their brands are top of mind when spending resumes) Final Stats: 23 minutes 29 slides 1,396 builds 55,000 charts = 0.0007% of info To get the expanded version of this presentation, please contact me at: [email_address] Twitter: @geofframsey