The Ad Herd is Migrating to Unmeasured Media
Since 1956, the ad industryâ€™s leading publication, Advertising Age (or Ad Age for short) has been tracking the ad spending of the top 100 U.S. advertisers â€“ and since that time, â€œmeasuredâ€ and â€œunmeasuredâ€ media have been analyzed.
Before the Internet, â€œmeasuredâ€ media consisted primarily of TV and print, which were subject to ad tracking services that were able to measure and report on effectiveness. Then the Internet came along, and while there are services that do indeed try to measure the effectiveness of Internet display ads, defining measurement standardsÂ has been a significant challenge.
On the unmeasured side, the pre-Internet definition related to any kind of advertising that wasnâ€™t officially measured, even direct marketing (which, paradoxically, is as measurable a medium as any, but not according to the ad world). Again, in recent years, all sorts of â€œunmeasuredâ€ digital media have been added to the category, including online video, search marketing, and social media.
The Big Shift
Not surprisingly, measured media has routinely attracted the lionâ€™s share of big advertisersâ€™ media dollars over the years. But that seems to be changing, and itâ€™s largely due to the influence of the digital world.
Ad Age reports that, for the first time, the Internet is expected to surpass newspapers this year as the second-largest ad medium, behind TV, according to media research firm ZenithOptimedia. In fact, Ad Age reports that the top 100 advertisers increased spending on unmeasured media by 12.6 percent in 2010 over 2009, and by 11.8 percent in 2011 over 2010. Meanwhile, spending on measured media in 2010 increased by 6.3 percent but actually fell by 0.2 percent in 2011. A â€œmodest reboundâ€ in measured media is expected in 2012, according to Kantar Media.
But the trend is clear: The big guys are making a big shift in where they put their ad dollars. Or, as Ad Age puts it, â€œMarketers are putting money into disciplines that directly connect them with targeted consumers. Advertisers are reshaping the media pie.â€
Online Companies are Big Spenders
While the list of 100 leading advertisers includes such megabrands as Apple and Coca-Cola, four strictly online companies are also on this yearâ€™s list: Amazon, eBay, Expedia, and Google. All four companies dramatically increased their ad spending in 2011, according to Ad Age.
Amazon spent 57 percent more in worldwide advertising in 2011 and about 60 percent more in the U.S. eBay increased worldwide ad spending by 21 percent in 2011 and 24 percent in the U.S. Expedia showed a worldwide ad spending increase of 15 percent in 2011, with a 27 percent jump in U.S. ad spending.
Google took the prize, however. The company doubled its worldwide ad spending in 2010 and doubled it again in 2011. With Googleâ€™s acquisition of Motorola Mobility, the combined companyâ€™s advertising spending in 2011 was over $2 billion.
Where the Big Herd Leads, the Smaller Herd Follows
The movement of the big herd into unmeasured media, which these days is largely defined by online promotion, is a trend worthy of note for two reasons.
First, it signifies a fundamental recognition by the countryâ€™s largest advertisers (and therefore their agencies) that online marketing is an investment worth making. Big advertisers would not invest the kinds of dollars they are putting into search marketing, online video advertising and social media if they didnâ€™t believe their investment was paying off.
Second, the trend is likely to be followed by the smaller herd â€“ all other national advertisers who fall below the top 100 cut-off, but who typically scrutinize every move of the big guys and, more often than not, follow in their strategic footsteps. They might not have the gargantuan ad budgets, but they surely have the ability to slice up the pie in favor of â€œunmeasuredâ€ media. Since the big guys are doing it, the smaller guys will too.
We are witnessing a key turning point in the ad world. The big guys are finally betting big bucks on the Internet. That should make online marketers giddy with excitement and optimism.
About Barry Silverstein
Barry Silverstein is a freelance writer/marketing consultant. In addition to writing for ReveNews, he is a contributing writer to Brandchannel.com, the worldâ€™s leading online branding forum. He is the author of three marketing books, The Breakaway Brand (co-author, McGraw-Hill, 2005), Business-to-Business Internet Marketing (Maximum Press, 2003) and Internet Marketing for Technology Companies (Maximum Press, 2003). Barry ran his own Internet and direct marketing agency for twenty years. You can find Barry on Twitter @bdsilv.