There are pretty much two winners currently in media: TV and Internet advertising. Those are the only two reliable growth areas in an ad market that’s slumped substantially in the last five years.
Magna Global released its global ad spending forecast today reinforcing the power of TV and the Web. Internet ad spending is forecast to expand 10.9 percent in 2012 with TV spending up 6.8 percent. The Internet is continuing to take share from withering traditional media channels print and directories. The newspaper industry is still searching for bottom, with another 6 percent decline forecast for this year on top of a 9.8 percent decrease in 2011. Directory spending has also been slashed. The category should contract 19.1 percent this year, according to Magna, adding to the 20.1 percent it decreased in 2011.
Overall, ad spending is expected to rise 3.7 percent in 2012, an expansion due in large part to the injections of spending from the presidential election and Olympics falling in 2012. Those years are always a bonanza for the ad industry. Without the twin big events, ad spending expansion would sit at 2 percent in 2012, a slowdown from the 4.5 percent growth seen last year.
“The shift to digital away from some traditional media, especially newspapers, magazines and radio, is not a one-to-one shift,” said Vincent Letang, head of global forecasting at Magna. “There’s some evaporation in the process. Advertisers can reach their communication goals more efficiently in some cases. The overall pie doesn’t grow as much in the digital age with this evaporation effect.”
That “evaporation effect” clouds a rosy short-term picture for digital media. It raises the question of how long it can rely on growth coming at the expense of weakened direct response categories like directories and a newspaper industry seemingly in free fall. Letang estimates the two categories will continue to lose share for at least the next five years before bottoming out. The Web has certainly done little to dent the primacy of TV. It is growing at a slower rate from the Web, but it boasts a base twice as large.
“TV is also taking money from the other traditional media categories,” Letang noted. “It’s keeping or slightly increasing its share. TV is still a healthy medium in terms of audience and viewing trends.”
The Internet itself has winners and losers, of course. Paid search, already half the market, is due to fare well, expanding 12.6 percent. The two major growth areas forecast are mobile (up 44.2 percent) and online video (22.4 percent).
‘Not the future’: European publishers remain steadfast in blocking alternative IDs to third-party cookies
Some European publishers believe alternatives to the third-party cookies, probabilistic or deterministic, will do more harm than good to their ads businesses.
Media Briefing: Why Leaf Group spun off its media arm into a standalone company
World of Good's newly appointed CEO Lindsey Abramo spoke with Digiday about her plans to lean into experiential and embrace niche vs. scale.
Dentsu’s latest ad report shows slowed growth, driven mostly by inflation
The good news in Dentsu's ad forecast is that there's still growth. The bad news: most of the growth is the result of inflation, while real ad pricing actually dropped a bit.
SponsoredWhat the measurement and currency discussion really means to TV advertisers
Ali Mack, head of TV and agency, Experian Major streaming video providers have recently made headlines by adopting new currencies for ad measurement, threatening Nielsen’s long-standing TV ratings monopoly. NBCUniversal, for example, has certified iSpot and VideoAmp as currencies for advanced audiences and formed the Joint Industry Committee with Paramount, TelevisaUnivision and Warner Bros. Discovery. […]
How chef influencer Tue Nguyen works with the BuzzFeed Creator Network
BuzzFeed's Creator Network has been valuable from an audience and production education standpoint, but Nguyen still drives most of her business on her own.
Dentsu’s new Web3 readiness tool shines light on the tech’s potential to complement AI
Dentsu's Innovation Initiative is launching a web3 readiness index next month — at a time when the industry is obsessed with AI. Could the two technologies actually make a good pair?