Dove Direct Print and Marketing Blog, “Digital Ad Spending Displacing Traditional”

Welcome to the Dove Direct Print and Marketing Blog. Today's post, "Digital Ad Spending Displacing Traditional" examines the latest forecasts pointing to digital advertising dollars set to overtake traditional (aka offline) ad spending in 2019. It should come as no surprise that digital is continuing to rise when it comes to ad buys, and to that end the traditional/offline sector is becoming more and more dependent on revenue gains generated by political years.

For example, and according to eMarketer, Television ad spending is forecast to decline by 2.2% in 2019, down to $70.83 billion. The reasoning behind this downward trend is multi-fold including 2019 being an off-election year, not to mention the absence of the Olympics and the World Cup.

Keep in mind that brands, agencies, and marketers have become well aware that consumer activity has moved en masse to digital platforms. Simultaneously, traditional/offline media advertising is unable to generate even gradual gains, in reach, frequency, and revenue generation. As a result, digital advertising is making a difference and is forging ahead.

Digital Spending Comparison

When we look at comparing digital ad spending to traditional ad spending, we can clearly see a trend line developing from 2018 and onward forecasts. The following numbers indicate what marketers have been predicting over the past five years. The following ad spending comparison numbers provided by eMarketer (Feb 2019) are in the billions:

• 2018 - Traditional = $114.84 - Digital = $108.64
• 2019 - Traditional = $109.48 - Digital = $129.34
• 2020 - Traditional = $107.13 - Digital = $151.29
• 2021 - Traditional = $104.32 - Digital = $172.29
  
  

In the event the forecast for these ad spending numbers holds over the next three years, several real-world ramifications could be afoot. As television ad spending declines, there is a reasonable probability that 30-second spot prices may increase to make up for the revenue shortfall.

It's common practice that when a brand faces declining revenues, the initial step to ensure that revenue goals don't fall too far is to increase prices for the same offerings or to increase the value proposition for the same products and services. While those types of approaches typically represent a short term fix, the long view is that the organization will have to rethink and reposition their product sets.

Therefore, it's a strong probability that television 30-second spot buys will become more expensive, while reach simultaneously declines as more people will utilize the digital spectrum.

Another ramification could be one of increased data value present in digital advertising that currently traditional/offline advertising cannot match. Right now, in the digital advertising world, Amazon has become a boon to advertisers with unmatched beneficial assets.

The Amazon Factor

According to Monica Peart, eMarketers forecasting director, "Amazon has a major benefit to advertisers, especially consumer-packaged goods and direct-to-consumer brands. The platform is rich with shoppers' behavioral data for targeting and provides access to purchase data in real time. This type of access was once only available through the retail partner to share at their discretion. However, with Amazon's suite of sponsored ads, marketers have unprecedented access to the 'shelves' where consumers are shopping."

Peart continued: "The steady shift of consumer attention to digital platforms has hit an inflection point with advertisers, forcing them to now turn to digital to seek the incremental gains in reach and revenues which are disappearing in traditional media advertising."

Diminishing Returns

Remember when blogging (a digital platform) popped onto the scene? The initial returns for early adopters were so significant, that blogging not only became a 'thing,' but also emerged as a marketing tool. For a while, content-rich blog content could compete for decent digital ad spending dollars.

Now that we have blogs posts well into the billions, digital ad dollars for blog posts have dropped off to some extent, with the significant iconic blog posts demanding increased ad dollars.

Print is Digital

Another interesting consideration in the digital ad spending prediction is that some platforms that once were considered traditional have leaped to being digital, or a hybrid of digital and traditional in a single platform.

Print, often considered a traditional marketing medium, is now both digital and traditional. Print collateral now enjoys being digital in the creation of printed pieces. Variable Digital Printing (aka variable data printing) is a digital-based printing infrastructure. This infrastructure is made up of hardware and software that runs via computer technology. The resulting output from digital printing projects are traditional, in that paper types, inks and graphics form the output. However, each piece can be customized for various consumer targets.

Print Helps Digital

Recent trend reports by a host of data mining organizations have alluded to direct mail undergoing a resurgence of sorts. There are a multitude of factors that have driven direct marketing, aka direct mail marketing's resurgence.

1. Direct mail has shown to increase email marketing open rates
2. Direct mail is considered the most trustworthy medium
3. Direct mail is for the most part clutter free in that recipients are not tasked with receiving over 10,000 ad messages per day
4. Direct mail invokes tangible, tactile human response traits that digital is unable to match
5. Direct mail increases purchases by 28% via luxury brand catalogs targeting upscale consumers

Therefore, the print medium could qualify for both the digital spectrum through the creation and the traditional medium, where consumers receive and view the marketing messages in beautifully created printed pieces.

The Net-Net

While digital ad spending is forecast to displace and disrupt traditional ad spending, we contend it would be wise to consider including print marketing from the digital as well as inclusive of the traditional platforms. Therefore, as digital spending increases, so will the overwhelming clutter that is sure to accompany those spending initiatives, allowing print's targeted direct mail to stand out even more in directing digital users to those online destinations. Thanks for reading "Digital Ad Spending Displacing Traditional."

Let's have a conversation about direct mail strategies, printing, print software, transactional documents, variable digital printing, brand equity and unified marketing collateral during our next Open House. We invite you to join us on Thursday, February 28, 2019, for an hour or two, anytime between 9:30 am to 4:30 pm. Let us show you how to improve your document processes to optimize your workflow, reduce your costs, and maximize your organization's printing, letter shop, and mailing capabilities. Dove Direct does have an official USPS certified bureau located within our offices that will save you time and money. Moreover, if you bring us your files, we will create a demo file for you. For more information call Carla Eubanks at 404-629-0122 or email Carla at This email address is being protected from spambots. You need JavaScript enabled to view it..

Dove Direct, your Atlanta based print and mail solutions provider offers organizations end-to-end data, printing, and mailing solutions: Data Management, Variable Digital Printing, LetterShop and Fulfillment, Fully Automated MLOCR Presort Bureau, Marketing and Production Management Support and Secure Data Life Cycle Management.

If you don't want to wait for the Open House, you can reach Dove Direct today by calling 404-629-0122 or use the contact form for Dove Direct.