Spending Starting to Shift for Big Advertisers

Articles in MediaPost and the WSJ (sub req’d), drawing on TNS data, reflect that among the top 50 US advertisers there’s a small but meaningful shift from traditional media to the Internet happening. From the WSJ article:

In a sign of how major advertisers are shifting money out of traditional media, ad tracking firm TNS Media Intelligence reported that the nation’s 50 biggest advertisers cut their spending on “measured” media such as TV, print and Internet display ads by 1.5% in 2006 — though U.S. ad spending grew 4.1% overall.

While some of the decline may reflect overall cutbacks in ad spending by big marketers, it likely signals that big companies such as Procter & Gamble are reallocating some of their ad budgets to new Internet ad venues which aren’t measured by TNS — such as paid-search advertising, social networking and online video.

Here’s a table from the MediaPost article:

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(Further down in the article is a helpful chart on US ad spending ($) by media type.)

This follows the earlier announcement by Microsoft that it would shift most of its ad budget to online/digital media. Simultaneously, you’re seeing most of the major brands and marketers put their accounts up for review.

These trends together suggest a couple of things:

  1. Marketers are looking for more “accountability” (metrics/clear ROI)
  2. Their spending allocation is finally catching up to the migration of audiences online

Let’s be clear: a truly successful campaign will integrate and combine traditional media elements and online. (Here are data from BIGResearch that show how traditional media prompt online searches.) But the cost and lack of metrics and clear ROI (even at the branding level) of some traditional media is causing marketers to rethink ad spending distribution.

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Related: MediaPost reports on gains for online display advertising. And here are the top online display advertisers.

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