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US Advertising, Marketing Spend to Reach $412.4B in ‘08

Outsell, a market research firm released the article below. From what I've seen the media spend number make sense. It shows that there is a continuing shift to online media:
Spending on total US advertising and marketing will grow 3.9% in 2008 to reach $412.4 billion, with the advertising portion reaching $249.1 billion, according to the third annual ad spending report by Outsell, Inc., which said growth has declined from 2007’s 5.8%.

The report covers five key media types: online, print, events, TV/radio and others. Outsell surveyed 1,088 US advertisers on their spending plans for the year.

Among the significant findings:

  • Companies are spending 61.8% of their online ad/marketing budgets - $65.1 billion - on their own sites, siphoning dollars away from other options. As a result, publishers are beginning to offer their own advertising/marketing services to recapture lost revenue.
  • The fastest-growing of all ad types is online, which is expected to grow 12.3% in 2008 to $105.3 billion (or $40.2 billion excluding advertisers’ spending on their own sites). As a result, online spending now exceeds TV/radio/movies for the first time ($98.5 billion).
  • Advertisers’ spending on traditional media remains significant - with print capturing 35.5% of spending ($147.0 billion) and events at 12.5% of the total ($51.7 billion). 54% of advertisers spread budgets across three or more media types.
  • Out of 26 methods measured for effectiveness, advertisers rate their websites as the best for lead generation (75% effective), followed by exhibitions (66%), custom print publications (65%), direct mail marketing (64%), and trade magazines (64%).
  • Asked what metrics they would track if they could track only three, advertisers point most frequently to cost per sale (46%), cost per lead (37%), and cost per click (32%).

Rajiv Parikh

Rajiv Parikh is the Founder and CEO of Position2. For Rajiv, digital marketing provides the perfect intersection between economics, creativity, data, and technology. Rajiv has an MBA from Harvard Business School and a BS in Electrical Engineering from the University of New Hampshire.