Marketing Forecast from Ad-ology

There’s no question that we’re in an ad recovery, especially given the strength of the rebound last year: 8.0%. What forecasters can’t settle on is the level of ad spending growth seen for 2011. MagnaGlobal had previously predicted a global increase of 5.6%. But that forecast has been revised, down.

Last year, research shop Schonfeld & Associates predicted an average advertising budget to sales ratio of about 2% for 2011. And the firm’s analysts also expected total ad growth of 8.5% across major industries. So far, the ad rebound in 2011 has been positive and the company’s analysts say several industries will fuel more ad spending in 2012.

Could the boom in daily deal/social media marketing at the local level be contributing to the demise of more traditional, established media formats? New projections from Borrell Associates on yellow page and direct mail ad spending are sharply negative and the shift to interactive formats may be a big factor. But the news regarding the local ad market isn’t all bad.

TV has reigned supreme as the ad format that attracts the most consumers in the U.S. and keeps them watching for hours every day. Marketers are well aware of these statistics, and for now, they typically allocate the largest share of the budgets to the TV format when considering the best media mix. But is TV really that effective for marketers or should they be exploring something else?

As the economic recovery gradually strengthens, marketers continue to increase ad budgets. And for many, radio plays a key role in a balanced marketing mix. The latest report from the Radio Advertising Bureau (RAB) indicates that digital radio platforms are in demand.

Will spending on traditional media formats ever return to the highs seen in the pre-recession years? The quick answer to this question is – probably not. But not all media formats are created equal. Some traditional outlets, like TV, will fare better than others. And there are unique events that will spur marketer spending on traditional formats in the coming years.