Total media advertising spending slows down, digital advertising provides only growth source.

It seems the lower growth of the world economy, is spilling its effects everywhere, and advertising spending is no exception.... Total media advertising spending forecasts for the next five years have been revised downwards and it seems the market will not grow as quickly as expected.
But what is more interesting about this is that the main source of growth for the whole market will come from digital advertising, expected to grow 18% this year and reaching over $ 170bn in 2015, which is translated into almost 30% of the total spending, while the sectors expected to contract the most are the "traditional" markets.
In the US, the most developed market, growht has been revised downwards to 4.5% from 5.2% previously estimated on March. This adjustment is mainly due to lower than expected revenues in TV, newspaper, radio and magazines.
The trend is clear, money is moving away from traditional and going into digital.
You can read the full story here.

Growth in North America is slower than previously forecast. Total ad spending will grow 4.5% this year, less than the 5.2% forecast in March. The downward adjustment is the result of lower-than-expected expenditures on TV, newspaper, radio and magazines in the US. - See more at: http://www.emarketer.com/Article/Total-Media-Ad-Spending-Growth-Slows-Worldwide/1012981#sthash.wneypgFB.dpuf

Growth in North America is slower than previously forecast. Total ad spending will grow 4.5% this year, less than the 5.2% forecast in March. The downward adjustment is the result of lower-than-expected expenditures on TV, newspaper, radio and magazines in the US. - See more at: http://www.emarketer.com/Article/Total-Media-Ad-Spending-Growth-Slows-Worldwide/1012981#sthash.wneypgFB.dpuf

Growth in North America is slower than previously forecast. Total ad spending will grow 4.5% this year, less than the 5.2% forecast in March. The downward adjustment is the result of lower-than-expected expenditures on TV, newspaper, radio and magazines in the US. - See more at: http://www.emarketer.com/Article/Total-Media-Ad-Spending-Growth-Slows-Worldwide/1012981#sthash.wneypgFB.dpuf

Growth in North America is slower than previously forecast. Total ad spending will grow 4.5% this year, less than the 5.2% forecast in March. The downward adjustment is the result of lower-than-expected expenditures on TV, newspaper, radio and magazines in the US. - See more at: http://www.emarketer.com/Article/Total-Media-Ad-Spending-Growth-Slows-Worldwide/1012981#sthash.wneypgFB.dpuf

Growth in North America is slower than previously forecast. Total ad spending will grow 4.5% this year, less than the 5.2% forecast in March. The downward adjustment is the result of lower-than-expected expenditures on TV, newspaper, radio and magazines in the US. - See more at: http://www.emarketer.com/Article/Total-Media-Ad-Spending-Growth-Slows-Worldwide/1012981#sthash.wneypgFB.dpuf

Growth in North America is slower than previously forecast. Total ad spending will grow 4.5% this year, less than the 5.2% forecast in March. The downward adjustment is the result of lower-than-expected expenditures on TV, newspaper, radio and magazines in the US. - See more at: http://www.emarketer.com/Article/Total-Media-Ad-Spending-Growth-Slows-Worldwide/1012981#sthash.wneypgFB.dpuf

Growth in North America is slower than previously forecast. Total ad spending will grow 4.5% this year, less than the 5.2% forecast in March. The downward adjustment is the result of lower-than-expected expenditures on TV, newspaper, radio and magazines in the US. - See more at: http://www.emarketer.com/Article/Total-Media-Ad-Spending-Growth-Slows-Worldwide/1012981#sthash.wneypgFB.dpuf

Looks like digital ad agencies will be happy this holiday season…and so will shoppers at Kohl’s

US sales during the holiday shopping season are predicted to increase 4% to nearly $490 billion this year. This is a huge number – and holiday advertisers want to capture as much of the pie as they can. Retailers make up the biggest share of ad spending during the holiday period according to Kantar Media (ad tracking firm owned by WPP). In the 2013 holiday period, retailers accounted for 15% of total ad spend – almost $5 billion of the total $32.5 billion. During Black Friday, retailers spent almost $790 million during that week alone (omg).

Guess which retailers spent the most on ads last year?

Wal-Mart, Macy’s, Target, and Sears – not surprising. Wal-Mart spent the most: $300 million. See the chart below for other top spenders.

I don’t know if this is surprising to anyone else, but last year retailers spent 45% of their November and December ad budgets to television ads. I personally would have guessed it would be a lower portion. I’m going to go ahead and guess that this number will drop this year, and much more significantly over the next few years as retailers move more advertising to digital. Internet advertising was just 17% of total spend last year, and I bet that will be much higher this year.

Now that we’re on the topic of the holiday season and Black Friday, I’d like to highlight an article from WSJ about Kohl’s. Maybe this is not so related to digital marketing, but I found it interesting. In such a competitive environment, Kohl’s has spent the last year trying to reach a deal to undercut competitors’ prices. Kohl’s took the approach of working backward from the price they wanted to offer, and then to find a product that fits the price. $5 is that price – and this year Kohl’s will be offering toasters, coffee makers, blenders, and slow cookers at five bucks a pop. Yes, you heard it correctly!

Kohl’s was able to reach an agreement with Select Brands to manufacture these products. You might be wondering “why would Select Brands agree to such a thing?”. Well, even though the margins will be quite slim, the volume and one-time shipment makes it worth it. Also, the $5 price tag is after a $10 mail-in rebate – which many people won’t even bother to redeem so they’ll actually be sold for $15.

Happy Holidays!

Small Business Spending on Social Media

Small businesses, defined as companies with less than 100 employees, are seeing a few noteworthy trends (BIA/Kelsey survey for Q3 2014):

1. 74.5% of small businesses use social media to advertise or promote their businesses - this is up from 71.7% last year.

2. Small businesses spend, on average, 21.4% of their total media budgets on social media - this is up from 18.9% last year.

3. Print and outdoor spend is down to 18.5% from 20.9% last year.

As shown in the chart below, we have now reached a point where small businesses are spending the highest share of their budgets on social.





Facebook pages are most frequently used (55% usage), followed by LinkedIn ads (31% usage). Facebook ads and Tweets/Retweets on Twitter tied for third (20% usage).

What is interesting to note, however, is that less than 1/3 of these small businesses say that social is "Extraordinary" or "Excellent" in terms of ROI. The top 3 channels providing the best ROI were:

1.Online banner or display ads containing video (59.3% of respondents giving "Extraordinary" or "Excellent" rating)
2. Streaming audio advertising (57.7%)
3. Offers distributed on smartphones or tablets (54.0%)

Looking at conversion rates on social, another study by Convertro and AOL Platforms suggests that paid social ads have much higher conversion rates than organic content. This may tell us why small businesses are spending a larger portion of their budgets on social. However, this varies depending on the platform as you can see below:

Sources: http://adage.com/article/digital/small-businesses-spend-social-media/294988/http://www.emarketer.com/Article/Paid-Social-Ads-Convert-More-Customers/1011188