Advertisers Are Going Back to Old Media

Advertiser PerceptionsAdvertisers and marketers, jittery since the Great Recession, are now more optimistic than ever before about hiking their ad spending. According study conducted by Advertiser Perceptions, advertising spending is poised to exceed even the pre-recession freewheeling spending boom of 2007. For the first time in four-years, major brands have adopted a cheery economic outlook, and plan to increase spending on advertising in the next 12-months, especially in old media. That’s right, advertising executives have decided to return to the familiar, and patch things up with the traditional media channels they ditched for the more enticing new media operations. Why the return to old media? In the words of Neil Sedaka, “breaking up is hard to do,” especially when there is money involved. Could it be advertisers are chasing wealthy consumers, the only group showing growth in spending?

Advertising Execs Plan to Spend, Spend, Spend

The bi-annual Advertiser Perceptions survey questioned 3,200 ad and marketing executives representing the top brands in the industry. And the overwhelming consensus is to spend and spend big, despite the still fragile economy and high unemployment rates, according to a report on the survey by Ad Age. Why are advertisers so optimistic in the mist of a sour economy? Ken Pearl, CEO of Advertiser Perceptions, is at a loss to explain the sudden confidence in ad spending.

Advertisers Trend and Perception

“The biggest surprise was that in the face of what appears to be a weakening economy, optimism is not just maintaining but increasing among advertisers,” said Pearl. But is advertiser optimism really that much of a surprise? The economy may be weak for the have nots, but the haves are doing just fine. Wall Street is flush with cash and folks making more than $100,000 per year are spending with abandon.

The Haves and the Have Nots

According to ConsumerEdge Research, the “Willingness to Spend” index has fallen for every group, except the wealthier segment of the population raking in more than $100,000. Willingness to spend is increasing for this more affluent group. In fact, they are the only ones that have the necessary disposable income to put towards discretionary spending on luxury items and non-essential goods and services. Advertisers eying this robust recovery at the top of the economic food chain, have every reason to show optimism about future ad buys. Of course, brands, such as Walmart that cater to middle and lower-income consumers, are not as optimistic.

The Return to Old Media

The Advertiser Perceptions survey shows a distinct trend in ad spending within traditional media channels, particularly Cable TV. Ad spending for the next year is also projected to increase in broadcast TV, national newspapers and magazines. Spending on digital media and mobile sources look relatively flat. However, although no discernable increases in digital ad buys are expected, advertising decision makers have no plans to reduce digital spending. Digital and media advertising channels are still robust and healthy, especially with digital video. A previous Advertiser Perception study found that a majority of advertisers are more enamored than ever with digital video advertising, and they plan to increase spending in that sector by 22 percent. Advertisers are impressed with the more trackable and better ROI metrics that digital video ads provide.

Don’t Worry, New Media is Not Dead

This one study does not spell the death knell for digital and media advertising. But it does appear that advertisers have decided, for now, to embrace a more multichannel strategy to reach affluent consumers, whom may spend less time surfing the Web and more time watching TV, reading newspapers, magazines and connecting to the Web from their mobile devices. And this study could portend a shift in new media ad buys. Perhaps, the next area of growth would be seen in mobile advertising. Targeting affluent consumers with an annoying, flashing, spammy online ad doesn’t make sense. But personalized, targeted mobile ads make a lot of sense for today’s advertisers.

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  2. Kristin

    Solid summary. Right in line with baby-boomer demographics and speaks to the ever widening  divide between upper and lower class and where the $ is.

  3. Kristin

    Solid summary. Right in line with baby-boomer demographics and speaks to the ever widening  divide between upper and lower class and where the $ is.

  4. Kristin

    Solid summary. Right in line with baby-boomer demographics and speaks to the ever widening  divide between upper and lower class and where the $ is.

  5. Marcel Cramer

    Something that might blow up in the advertisers face is that the audience is no longer interested in being interrupted with ‘old advertising’. Why is it so hard for a majority of advertisers to understand that they need to befriend and respect the audiences they need, serve and sell to? The main reason is that a lot of agencies play the money game and are probably scared that if they do not force these decision makers to spend ‘above the line’ like they used to they will loose revenue. This is an ill fathomed short term approach and I doubt that it will stand the test of time or bring the returns these advertisers crave.

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    Fantastic summary. I love digital marketing. But i really strongly believe that old method was also superb. It’s good to know that old is always gold.

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