Looking ahead, forecasts indicate that the decline in traditional advertising spend is expected to continue as more marketers turn to digital channels, with the US media market size for online advertising predicted to be more than double that of traditional TV by 2023. Indeed, a majority of marketers expect their budgets for digital media to increase greatly in the next 12 months, per a report [download page] by Kantar.
The amount of time the average person spends watching online videos has risen quicker than expected. As such, more than four-fifths (84%) of the global marketing leaders surveyed expect their online video budget to increase in the next year. Seven in 10 believe their budget for social networks will rise as well.
Additionally, about two-thirds (63%) of respondents say that they expect to see their podcast budgets to increase. Podcasts, as an advertising channel, are catching on. A study from Advertiser Perceptions, commissioned by Cumulus and Westwood One, found 39% of advertisers and agencies in the US saying they currently advertise in podcasts (up from 32% in 2018). The same report also found that three-quarters (75%) of respondents had discussed the investment potential of podcast advertising with their colleagues.
The growing focus on podcasts as a channel is being led by agencies, with the Kantar survey finding that three-fourths (75%) of agencies are increasing their focus on podcasts. This investment seems wise, as past research has shown that people are spending more time listening to podcasts and they are more open to advertising in podcasts. Not only that, they are paying attention to those podcast ads, with about one-quarter claiming to have made a purchase after hearing a podcast ad.
Podcasts are not the only channel agencies are exploring more than their advertiser and media counterparts: they’re also focusing on advanced TV. In fact, more than half (52%) of all respondents say that their advanced TV budgets are likely to increase next year.
These budgets are likely to be not only put towards OTT, which has continued to increase in household penetration every year for the past few years, but also in data-enabled advertising, which advertisers expect will account for two-fifths of their TV advertising next year.
Among traditional media types, outdoor advertising – which continues to boast sustained growth – remains the channel with the brightest future, and the only one in which more marketers expect to increase (31%) than decrease (19%) their investments. The same can’t be said for radio, traditional TV, and cinema, for which more than twice as many respondents are looking to cut than expand budgets. This is despite the fact that cinema advertising is generally well-received by consumers.
As for print, the bad news continues: roughly two-thirds or more respondents expect to shrink their ad investments in newspapers (66%) and magazines (70%), while fewer than 1 in 10 are likely to go counter to the prevailing currents and grow their expenditures on these channels.
Measuring the Impact
As budgets for digital channels are widely expected to increase, how are marketers measuring their efforts? Nearly all of the respondents say they are measuring ROI for their marketing activities.
While marketers are doing well by measuring their activities, they may not be measuring them frequently enough. Only about one-quarter (26%) of the media companies surveyed said they measure ROI continuously. More advertisers (38%) and agencies (31%) tend to measure ROI on a continual basis, but a similar percentage of respondents say they only measure ROI either annually or less than once a year (34% for advertisers, 31% for agencies and 22% for media companies).
The full report can be downloaded here.
About the Data: Report findings are based on a global survey of 488 senior marketing leaders at advertisers, agencies (creative and media) and media companies.