From 8.69% of the ad spending pie in 2007 digital marketing is expected to be about 16% of the total marketing spend in 2011. All other marketing mediums (television, radio, print etc.) following the trend in the recent years, will see a drop in their share. Recession has only reinforced this trend as advertisers realise they have to do more with less. Notwithstanding recession, the full potential for online ad spending is huge – the allocation in consumer media spending is at around 10% for a consumer usage in US of 20-30%.
The trend doesn’t suggest that traditional mediums will be redundant rather the advertising market will eventually settle for a right-mix between digital and traditional mediums. Infact, developing marketing programs that integrate online and traditional media was one of the top challenges of CMOs in a recent survey by Jupiter Research. Agencies offering such programs are expected to do better than others.
Internet advertising revenues in the US grossed $23.4 billion for 2008 going up by 10.6% from 2007. For quite some years now search marketing has been increasing in share while display advertsing is taking a dip. This is quite the reverese in some newer and less developed internet markets, where display leads search. However, the distinct trend globally is that search will increase in share at the expense of display. Display will always be around for brand campaigns, search just cannot do it as well. Marketers likewise, are exploring the next right-mix – how does display influence search just as how brand campaigns influence direct response programs.
Retail sector has been the top spender in online advertsing for the last few years. In 2008, the industry spent $5.0 billion which is 22 percent of total revenues. The other top spending sectors have been financial services, automotive, computing, telecom, and leisure travel i.e. airfare, hotels & resorts.