Marketers Continue to Expand Digital Budgets, but Growth Is Slowing - eMarketer
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Marketers Continue to Expand Digital Budgets, but Growth Is Slowing

Web development, online advertising gain prominence in the digital realm

July 10, 2012

Marketing dollars are continuing an inexorable march toward digital. eMarketer estimates that US online ad spending will hit $39.5 billion in 2012 before climbing to $62 billion by 2016. However, online ad spending growth is set to decline over the same time period, dropping from 23.3% in 2012 to 7.8% in 2016.

Data from a May 2012 survey of senior-level marketers and agency principals by business development company RSW/US corresponded with those projections. The survey found that 57% of respondents said that 30% or more of their budget had shifted from traditional media to digital over the past three years. Back in 2009, 67% said that at least 30% of their budget had shifted, indicating a slowdown in the move to digital over the past few years.

Percent of Marketing Spending Shifted from Traditional to Digital Advertising According to US Marketers, May 2012 (% of total)

Overall, digital is commanding an ever-growing piece of the marketing pie—44% of respondents spent at least half of their total marketing budget on digital and social media in 2012. That was an increase from 31% in 2009.

Percent of Marketing Spending Allocated to Social and Digital Media According to US Marketers, May 2012 (% of total)

In terms of the types of digital capabilities being employed by marketers, web development saw a huge jump in importance. In 2009, 54% said they were using development. Three years later, in May 2012, 87% said they were using it. Online advertising also saw a significant bump, from 37% in 2009 to 74% in 2012. And while the use of social and digital media planning or buying had not been recorded in 2009, in the recent survey, 55% of marketers said they used it.

Digital Tactics and Services Most Often Used by US Marketers and Sold by Agencies, 2009 & 2012 (% of respondents in each group)

Interestingly, more marketers said that measuring the impact of social media was easier in 2012 than it was three years ago. However, RSW/US theorized that most marketers may be relying on simpler metrics, such as Facebook “likes,” without fundamentally understanding how these measurements impact their business.

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Check out today’s other articles, “The Ripple Effect of Following a Brand on Social Media” and “Major Gains and Losses in Smartphone OS War in Germany.”

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