According to Reuters, global advertising spending is set to reach $523 billion by year’s end — a 5.3% increase from 2013. However, as these media buys increase, is the placement reaching the intended audience or being placed on the right platforms?
The eMarketer study below shows the breakdown of U.S. media spend against the average consumption, per channel. You’ll see that while 41.2% of ad dollars spent goes to TV advertising, only 37.3% of a consumer’s time is spent there. Also, 19% of media budgets go to print even though it only attracts 3.5% of a user’s time. Looking at digital media, time spent with this channel consumes 47.2% of a user’s activities — or the majority of the time spent daily with media. Yet, advertisers are only dedicating 30.5% of their media budgets to this channel.
Diving deeper into the digital landscape shows that even fewer resources are being spent on mobile advertising, even though mobile usage and advertising is on the rise.
What is driving this discrepancy? Are marketers just stuck in their ways? Or is technology and proliferation a root of the problem?
When planning for a media spend or a marketing campaign, it’s important to view the problem alongside each solution. TV advertising might seem to have the biggest reach and most retention. However, in many situations, it’s the digital channels that will influence your audience.
eMarketer’s research uncovers opportunities among many digital channels, including Facebook, Pandora and digital video. While Facebook is my preferred marketing platform of choice (because it has the biggest audience), allocating a full year’s media support to this channel may be a misguided approach. The time that a user spends on Facebook, although it is vast, is only 6.0% of time they spend with digital devices and 2.8% of average daily time spent with all media. And in general, the media spend across other digital platforms, Facebook aside, is less competitive because many advertisers auto tune to that platform due to it’s ease of use and advanced targeting.
Now I’m not saying don’t allocate funds toward Facebook ads. We recommend this to our clients regularly. However, dispense the budget across many digital platforms to increase your reach (if that’s the goal) and awareness.
Pandora, for example is an underutilized resource for increasing reach and awareness. According to eMarketer, the daily time spent on Pandora exceeds that spent on Facebook (7.1% and 6.0% respectively). Although, the media spend on Pandora dwarfs in comparison to Facebook (1.4% and 10% respectively).
The moral of the story is to distribute your budgets accordingly. If your focus is specific to growing your community within Facebook, then dedicate your dollars there. If you’re more generally focused on increased awareness, then plan for a diverse media mix and optimize as appropriate over time.
Want to have a deeper discussion about how to best allocate your media dollars? Send us an email or give us a call at 414.347.1266.