Social Media, Mobile Show Largest Growth Rates for Digital

Digital marketing channels and direct response promotions do not all yield the same rates of returns for advertisers. While online ad spending is on track to grow to $39.5 billion by year-​end and surpass newspaper print advertising, some of the newer promotional formats are more appealing to advertisers because of the increase in sales they bring. Looking at advertiser intent can help media companies learn which marketing formats will be in demand for the rest of this year.

The Direct Marketing Association and Winterberry Group regularly asks marketers to rate their spending levels for a variety of formats and to rank the expenditure on a scale of 1 to 5. The findings for the first part of 2012 suggest that marketers favored social media, mobile and email with slightly higher ad budgets. But for all these formats, growth intention by marketers has been slightly lower this year than last. Analysts have also begun to break out tablet marketing. In this study, mobile ranked 3.4 while tablets ranked 3.0 in terms of spending growth which indicates that marketers are more excited about mobile than tablets, for now. Channels that have seen essentially no change in spending include gaming, direct response TV and radio, and place-​based media (digital out-of-home).

Another key data point from this study centered on the portion of advertising directed to customer acquisition versus customer retention. During the recession, many marketers focused on customer retention, believing that few consumers were buying new goods or services. This year, there has a been a noticeable shift in marketer strategy. Now, about 61.7% of direct and digital marketing expenditures target potential new customers. The remaining 38.7% of spending targets existing customers.

Based on studies like this, eMarketer, which regularly forecasts the rate of transition to digital in the marketing world, affirms that its numbers are solid. By 2016, about 31.5% of all marketing expenditures will be digital. What we don't know yet is which digital channels will have the biggest pieces of the spending pie.

[Source: Marketers to Inch Up Social, Mobile, Email Spending. Emarketer​.com. 14 Jun. 2012. Web. 27 Jun. 2012] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.