Source: Ad Age
As the new decade opens, marketers are reflecting about what changes it will bring for advertising and media. (For a good example, see Mullen’s Edward Boches‘, “10 Predictions for Advertising“).
Forecasting is a tricky business at any time, but it is especially so right now. Consider that as the last decade opened, there was no ipod, Google was just getting started and Facebook founder Mark Zukerberg didn’t have his driver’s license yet. In 1999, there were no DVR’s and a cell phone was only good for phone calls; online social media meant chat rooms and discussion forums.
The proliferation of ‘digital media’ seems to have outrun our available words to describe it. Coining a new name for ‘new media’ that captures its interactivity has proven difficult. Somehow ‘Dynamic Media’ , ‘Shareable Media’ , and ‘User-generated Media’ fall short of describing what is happening.
One of the more curious aspects of the digital explosion is that marketers seem to be lagging consumers in embracing ‘digital media’. Josh Bernoff of Forrester who writes the blog, Groundswell, points out that consumers spent 34% of their total media time online in 2009, yet digital media amounts to just 12% of all media spending. This means most marketer’s energy is still spent developing advertising programs for newspapers, magazines and television, much as it was in 2000.
It should also be noted that while digital media has been growing, the total advertising and media industry have been shrinking, at least in terms of jobs (see chart). According to Ad Age, employment in the advertising and marketing services industry is down 10% from its 2007 all-time high, a loss of approximately 76,300 jobs. Media jobs fared even worse, down 112,500 since the recession began, which translates to one of every eight jobs. Although things are stabilizing they are unlikely to ever return to the levels of 2000 — when employment was 19% higher than it is today. This is a sobering reality, and one that is unlikely to turn around anytime soon.
Meanwhile a cottage industry is springing up to service the growing demand for social media programs. Individuals and small firms are filling a vacuum created by larger agencies who are finding it difficult to produce social media programs profitably — or that clients are not confident they can produce at all, I am not quite sure which. This cottage industry has little overhead and offers enthusiastic and creative practitioners who understand the new tools and platforms and are willing to try new things. Many are Millennials who unable to find a traditional PR or advertising job are innovating their way into an entirely new kind of marketing career, leveraging their knowledge of the target and of digital media.
Will these groups be the agencies of the future? Or will traditional agencies figure out how to absorb these renegade providers into their model? It could conceivably go either way. Regardless, I am in agreement with Denuo’s Rishad Tobaccowala that we are about to enter an exciting new age in marketing, where strategy and execution are more closely aligned than ever before. In the past, strategic capability was strong, the tools for executing communications and marketing programs were often clumsy and blunt. Insightful psychographic segmentation schemes were often reduced to the target ‘women 18-44’. Now, the opposite seems to be true: the tools are sharp, but strategy often lags.
My prediction for 2010 and beyond, is that digital will continue to grow at the expense of traditional media in the race to attract consumers’ attention. The marketers who will thrive in the coming decade will be those who know how to bring the tools and the strategies together.
