A new report from Zenith predicts Internet advertising will exceed half of global ad spend (52%) in 2021, although, as the internet ad market matures, growth is projected to slow down annually from 17% to 9%. This will mean, for the first time since 2001, growth will be in the single digits, bringing the Internet ad market in line with the growth rate of the market as a whole.
The continued growth is largely being driven by smaller, local businesses that spend their budgets on platforms that allow them to manage their advertising placements with self-service tools like those available on Google and Facebook. A majority of larger brands commit less than half their budget to those platforms as they have traditional media in the mix.
Speaking to Campaign, Matt James, global brand president at Zenith, said, “The categories that have advanced the furthest in using modern digital channels are technology, media, finance and professional services. And even within these, brands still rely on traditional media to create broad mass awareness and reinforce brand values.”
In traditional media, it’s no surprise print media spend has been in decline with online alternatives capturing readers and advertisers. Zenith is forecasting a slight decline in television ad spend, but other media are relatively healthy. Radio is growing at 1% annually. Out-of-home providers are expanding digital display networks which are contributing to 4% annual growth. One of the more interesting findings is in Cinema, while only accounting for 0.8% of total ad spend, is growing at 12% a year, largely due an increase in popularity in China.
The slowdown in growth could mean that the “digital will solve everything” attitude that has captured our industry for at least a decade, is winding down. Brand marketers are becoming more aware that a balanced mix of tactics is required to appeal to customers. And while brands can certainly be built online, almost all of the great brands that are widely known today have been built with traditional media.
The shift should trigger four questions for brand marketers:
1. When Was The Last Time You Did A Situational Analysis? The pressure for marketing to perform has never been greater, but all the focus on generating tactical activity can easily make you lose sight of where you are and where you sit in the market and how you’re positioned against competitors.
2. Does Everyone On The Team Understand The Brand’s Vision? Again, the speed at which we can spin up online tactics tends to put even the best vision statements in the rearview mirror. Mid flight optimizations and one-off campaigns can get you new leads and increased engagement, but if neither align to your vision, you could be weakening your brand by pursuing short-term gains.
3. Have You Evaluated Your Marketing Mix Recently? If you’re seeing declines in performance from any channel, are you creating an environment that encourages your teams and agencies to think creatively? Too often, brand marketers can be very prescriptive about tactics when they should be providing a platform and guard rails for imagining better ways to inspire customers.
4. Are There Other Approaches To Consider? Consider technology that augments the data you already have, saving your brand from having to ask customers for more information. In-store or pop-up experiences also provides ways to reach customers beyond what you’re doing today.
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Branding Strategy Insider is a service of The Blake Project: A strategic brand consultancy specializing in Brand Research, Brand Strategy, Brand Growth and Brand Education
