Mediavillage Analysis Shows Digital Spend Continues To Replace Declines In Linear Investments
A new analysis by MediaVillage, which has been tracking media and marketing expenditures since 1988, shows that the total investment in marketing communications has remained flat since 2010, and is projected to increase by 2.8% from $580 billion in 2010 to a projected $596 billion in 2020.
Jack Myers, Media Ecologist and founder of MediaVillage, said, “When factoring inflation, the real dollars invested by marketers in the US marketing and media economy has declined precipitously. The increased spend in digital continues to offset the overall decline but we are also seeing a decline in digital from previous years.”
Of the total spend in 2017, digital advertising/marketing expenditures increased 20% to $157 billion and continue to offset the decline in linear spend. This growth of digital offsets overall 2017 declines in legacy marketer expenditures of 6.2%, with only out-of-home/place-based media, cinema, broadcast syndication and branded content receiving increased investments from marketers for their legacy inventory. However, digital spend for 2017 is down from a 26% spending increase in 2016 vs. 2015 and MediaVillage forecasts a continued slowdown in digital spending growth across all media and marketing sectors.
Jack added, “The fragmentation and commoditization of marketing and media, the effectiveness of search and social advertising for achieving corporate below-the-line sales objectives, and the increased involvement of procurement officers in the marketing budgeting process has enabled marketers to reduce their corporate commitment to marketing.”
Total digital investments are projected to increase at an average of 15% annually in 2019 and 2020. Myers forecasts that broadcast network linear expenditures would decline by 2.2% in 2017 and grow 1.6% in 2018, while marketers’ investments in broadcast network digital inventory would increase by 18% annually, bringing the total broadcast network industry ad revenues into the black — to +0.3% this year and +4.0% next year.
Myers economic reports also exclusively separate legacy/linear and digital spending within each category. MediaVillage’s full 2000-2020 Marketing/Advertising Expenditure Report will be issued later this month and is available to MediaVillage member companies.
Currently, MediaVillage is a leading research and trade marketing communications platform dedicated to helping global media and advertising companies increase their brand equity through strategic perceptions management. Through unique marketplace intelligence, strategic counsel, and an exclusive content creation and distribution platform, the company shapes the perceptions that influence key decision makers in the media buying, planning and selling process.
MediaVillage was founded by Jack Myers, a media expert, author and leading business analyst with decades of experience in the media and advertising industries. MediaVillage’s mission is to strategically improve the positive perceptions of its client’s organization, products, services, and executives.