Where the ad money is …
November 26, 2008 by Dave Haynes
Marketing Charts had an interesting piece this week about advertising spend and where it goes – including the conclusion that 52 per cent of the ad dollars spent in the US was on direct marketing. That’s $177 billion, or roughly 1/3 of what Wall Street executives spent on dinners at Masa last year.
Expenditures on direct marketing media and processes will again outpace general advertising in 2008 and 2009, and – though they will grow slowly – are on track to capture 53% of total advertising expenditures next year, according to a yearly forecast report from The Direct Marketing Association (DMA).
“The Power of Direct Marketing Report,” an annual accounting of direct marketing’s impact on the US economy – including advertising expenditures and sales – reports that advertising dollars are continuing their long-term migration from general advertising to direct marketing.
At the same time, direct marketing expenditures are expected to grow slowly in 2008 and 2009, while direct marketing sales will grow slowly in 2008 but slightly faster in 2009, the report said.
Direct Marketing Ad Expenditures:
DMA predicts that marketers will make $176.9 billion in direct marketing advertising expenditures by the end of 2008. This represents a modest 3.0% increase over the $171.7 billion actually spent in 2007.
The slow growth in 2008 is being caused by the worsening impact of lower home sales, a meltdown in mortgage lending, lower furniture, appliance, and automobile sales, and higher energy prices, according to the report.
In 2009, total direct marketing advertising expenditures are expected to increase 3.5%, yielding $183.1 billion.
Above average, double-digit spending growth will occur in commercial email and internet marketing as businesses take advantage of the continued move toward electronic purchasing.
Financial services, professional services and retail are among the top industries in direct-marketing spend in 2008.
So what does this mean? Ummm … beats me. I could play wise industry sage or admit I know about as much as the next guy who gets unsolicited phone calls and admail.
What I can get out of this is that there is a big pile of money out there, and if I had technology that somehow tied in to this – like screens and handheld devices – I’d be figuring out ways to tap into it.
One interesting side note is the$42 billion spent on telephone marketing. The US put a national do not call registry ion place early this year and you have to think that is money that will start going elsewhere as outbound call centers grow less effective.
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