Last week, I got a report via email from Jack Myers called, “2000-2020 Advertising & Marketing Spending Statistics: Exclusive MyersBizNet Data.” It’s a fantastic report containing a goldmine data on how marketing budgets have shifted 2000-2010 and how they are predicted to shift 2010-2020. Here are the key summary data from Jack’s report:
Although I am comfortable with numbers, I was having a tough time digesting all this data and answering the question “Which marketing channels are going to be the biggest winners?” and conversely, “who are going to be the biggest losers?”
So, I put together a simple chart by doing the following:
- Copied the raw data into Excel
- Created a new column called Share Gain/Loss which is calculated by subtracting 2010 % Share from 2020 % Share. A positive number indicates that the channel gained market share and a negative number indicates that the channel lost market share.
- Created another new column called Amount Gained/Lost which is calculated by multiplying the Share Gain/Loss by the total 2020 marketing pie of $589 billion.
- Sorted the report from biggest winner to biggest loser in terms of Amount Gained/Lost
- Visualized the data using a simple bar chart
Here are the results (click on the image to see high-resolution version):
And after seeing the chart, here are some immediate observations:
Unsurprisingly if you are a Mary Meeker Time Spent disciple (FWIW I’m not one of them), Mobile & Apps Advertising is expected to be the biggest winner +$41.82 billion. Maybe 2015 is finally the year of mobile!
Social Media/WOM/Conversational Marketing comes in second at +$22.97 billion. I wonder how they calculate this because it’s such a vaguely defined category and most of it is “non-working” media. But the key takeaway is Social is a big winner.
Search Marketing (Online) comes in third at +$20.62 billion. Search continues to win bigger advertising budgets. What a great business for Google!
Online Video is expected to gain $13.5 billion dollars of marketing budgets from virtually nothing not long ago. The various forms of traditional TV are holding strong or growing. Video is hot.
Surprisingly, Online Originated Display (Banner) Advertising is expected to shrink by $0.59 billion. I find this one hard to believe with the IAB reporting steady double-digit growth in this medium.
Newspapers are expected to continue their slide losing another $8.25 billion of marketing budgets. I worry about the 4th Estate. Unless we find other ways to fund quality journalism, society is going to suffer.
Direct Mail/ E-Mail Marketing is expected to be an even bigger loser at -$22.97 billion. I’m not sure why direct mail and email get lumped together because they are very different marketing channels. I find this one especially hard to believe. For starters, both channels continue to be very effective marketing channels and I doubt that smart advertisers would move budgets away from something that is working well. Second, we watch these channels closely and we’ve not seen any drop-off since 2010. Which means all the market share losses will come suddenly in the next six years. Although I agree these channels are on the decline, they seem on a slow decline at worst. I’d love to know the data that supports this prediction.
Finally, the biggest loser is expected to be Shopper Marketing (FSI’s, Consumer Promotion) losing $71.27 billion dollars of marketing budgets. I’m not very familiar with these channels and can’t provide any insight other than the obvious observation that this a lot of money and is going to hurt a lot for those involved.
As with any prediction, I take these data as guesses versus facts. But Jack Myers and his team are smart people and definitely worth noting. I will be curious to see how this compares to the predictions that Bruce Biegel will give next week in his Annual Outlook: What to Expect in Direct & Digital Marketing 2015 presentation.
Anyway, I hope you find this chart useful and definitely check out Jack’s report for more detail and explanation of the data.