Dirk Smillie, 03.08.10, 12:00 AM ET
We’ve been waiting for this: A study by Outsell, to be released Monday, reveals that U.S. advertisers are spending more this year on digital media than on print. Long predicted, this Madison Avenue milestone has finally arrived thanks to a 9.6% boom in digital advertising in 2010.
That number comes from Outsell’s annual advertising and marketing study, which collected data from 1,008 U.S. advertisers (both consumer and B2B) in December 2009. Of the $368 billion marketers plan to spend this year, 32.5% will go toward digital; 30.3% to print. Digital spending includes e-mail, video advertising, display ads and search marketing. “It’s a watershed moment,” says the study’s lead author, Outsell vice president Chuck Richard.
As disrupting as this digital onslaught is to champions of print, the Outsell report has some surprising news for one old media category. Ad spending for magazines will rise this year by 1.9%, to $9.4 billion. That number reflects a spending boost of 4.2% for consumer titles and 1% for B2B. “Marketers are telling us they’re giving this print category some serious attention,” says Richard.
Digital may now be the primary survival strategy for publishers, but Richard offers another glimmer of optimism for print denizens. After a year of pounding their expenses and debt into far slimmer balance sheets, “We should see far fewer closures and cutbacks among traditional media,” he says.
Not so for mobile marketing, another category studied in the Outsell report. “The proof isn’t in yet that mobile spending is all that effective,” says Richard. He offers this example: The Sports Illustrated swimsuit iPhone app was touted by many as a huge success. The issue is the most hyped magazine event of the year. The app was the 33rd-highest-grossing mobile app in the iPhone store. “But if you do the simple math, 32,000 people paid $2 apiece to download it. That’s $64,000.” A single page of advertising in the print version of the swimsuit edition, says Richard, brings in about $135,000 a page. “It’s time for a reality check.”
Marketers seem to know that. In spite of the staggering number of ventures flinging content onto mobile platforms, advertisers will spend 16% less on mobile in 2010, notes the study.