In the midst of a deepening economic crisis, many marketers in the US are tightening their ad spending belts, and ad forecasters continue to adjust their predictions downward, with dollars draining from traditional media. But some savvy marketers are bucking that trend—and dealing with the downturn by spending more.
One-third of marketers surveyed in October 2008 by the Association of National Advertisers said they planned to cut marketing and advertising spending this year to account for the economic downturn. Another one-third said spending would remain constant and the marketing mix would be reallocated, while 27% said they planned to spend more.
Nearly four out of 10 of those same marketers (39%) said they would spend more on marketing and advertising next year, and 28% said they planned to keep spending at current levels. Only one-third said they would spend less.
Industry prognosticators, however, continue to paint a dire picture, with bleak forecasts across the media landscape.
Traditional media—newspapers, magazines, TV and radio—will be hit hard, as marketers become more frugal with ad dollars or take their money and apply it to more-measurable media.
Three industry forecasters—Barclays Capital, Myers Publishing and Wachovia—predicted spending for TV, radio, magazines and newspapers would decline in 2009. That is on top of almost universal declines in 2008 estimated across those same media by these forecasters, as well as by Goldman Sachs, Nielsen Monitor-Plus and TNS Media Intelligence. The only exceptions are Barclays’ estimate that network TV spending would be up a marginal 1.6% in 2008 and Nielsen’s estimate for radio, up 2.1% in 2008.
As usual, online spending is the one bright spot, and as a measurable medium should continue to reap benefits in a down economy. Online spending and its share of total ad spending will increase year-over-year through 2010, but even that media growth is slowing compared with the past few years. Myers Publishing predicted that online spending in 2008 would total $24.6 billion, an increase of 13.8% compared with last year, and that it would climb 13.4% to $27.9 billion in 2009.
“While economic realities are slowing the growth of emerging media, at least they are growing, unlike traditional media,” Jack Myers of Myers Publishing said in a statement. “In the recession of 2009, marketers will be making cuts across the board and will seek safe harbors and cost-efficient alternatives.”
eMarketer’s prediction of 17.4% growth online to $24.9 billion in 2008 is higher than Myers Publishing’s forecast, but both came in with similar spending figures. eMarketer benchmarks its online ad spending projections against quarterly reports by the Interactive Advertising Bureau, which uses PricewaterhouseCoopers to conduct its surveys.
Agencies and brands from all verticals rely on eMarketer Total Access for analysis and data. Daily articles are just the tip of the iceberg. Find out what you are missing. Learn more about Total Access today.