As the economy slowly begins to pick itself up off the floor, we’re left to wonder what effect the past twelve months of cost cutting and penny pinching is going to have on advertising spend ratios in the future.
It’s no coincidence that, over the past year, spend on internet and mobile advertising has increased by 9.4% and 18.1% respectively. In contrast, newspaper (-18.7%), television (-10.1%), radio (-11.7%) and magazine advertising (-14.8%) have all had significant declines in overall spend (see ‘Shift Happens’ video embedded below). It is my opinion that, during the recent period of economic turmoil, many marketing managers were forced to re-evaluate their marketing budgets and the emphasis they place on traditional media spend. Marketers had to become more accountable.
Enter digital marketing.
During the downturn, marketers were drawn to the new shining star of the marketing mix – online advertising and social media marketing. It seems that many of these marketers had seen digital in action but were unsure whether or not to make the transition over to an integrated digital strategy to supplement their diminishing traditional advertising activities. In many cases it was like trying to convince someone who only eats Big Macs to try a McChicken for the first time.
Search engine marketing providers such as Google Adwords and Yahoo Search Marketing have seen massive growth in recent times due to their transparent, ROI based nature while Social Media Marketing is paving the way for a new frontier in branding and customer relationship management. It is a combination of relatively small costs, massive reach, active audience interaction and extreme accountability that has helped catapult digital marketing above the mainstays of the traditional marketing mix during the global financial crisis.
Being wedged in the middle of the digital marketing industry, this news is music to my ears. However, these figures and trends prompt me to ask the question: How much of the marketing mix will digital marketing be able to retain after the economy bounces back?
It will be interesting to see whether digital marketing will, on average, hold the same share of marketing budget it gained over the past 12 months, or will it be once again dominated by traditional media spend as overall marketing budgets begin to increase again. I guess the real question is, have marketing managers around the world enjoyed their taste of digital marketing or do they like their traditional flavours better?
Only time will tell…
