Where Will Marketing Grow in 2015?

Share this content:

Growth in marketing spending will come from surprising places, Winterberry Group predicts.

Like the moon's pull on the ebb and flow of the tide, marketing spending increases or decreases as trends change—and the GDP fluctuates. Bruce Biegel emphasized these continuous shifts during his keynote at the Direct Marketing Club of New York's “Annual Outlook: What to Expect in Direct and Digital Marketing in 2015” luncheon.

Biegel, senior managing director of Winterberry Group, kicked off with a look back at 2014, then took attendees through what to expect in 2015. Here are some of the highlights.

Traditional media –

In 2014 spending on traditional media stayed fairly flat. However, buoyed by elections and the Olympics, spending on TV increased 3.3%. Not much will change in 2015; although magazines may see a decrease and TV could hold steady at 3.1% growth despite a lack of special events like elections. “TV is still the one way to reach everyone,” Biegel cited as a key reason for the channel's ongoing popularity among marketers.

   

Direct and digital –

Last year marketers continued their spending shift to digital channels. There was huge growth (32%) in display (including desktop and mobile), as well as significant growth in mobile (24%, excluding mobile display and mobile search) and search (17%, inclusive of desktop and mobile).  Social, not surprisingly, was also a star, with 27% growth.

“But the big surprise was direct mail,” Biegel said. “It had a much better year than we expected.”

Indeed, direct mail spending grew 2.7%; Winterberry Group's prediction was for 1.1% growth. According to Biegel, much of the growth is attributable to cost increases in mailing and production; volume actually decreased. Though not as much as expected: “We're seeing more innovative uses of direct mail,” he said, especially for customer acquisition. Much of the volume decline, he said, was in retention mail because it's cheaper to maintain customer relationships via email.

This year will see similar trends in display, mobile, and social; Winterberry predicts growth of 21.1%, 37.3%, and 31.5%, respectively. Growth in display will be driven in part by programmatic. Direct mail and search will slow; some of the spending formerly dedicated to search could shift to display, mobile, and social. “Search spending will slow because you only have so much time to search for stuff,” Biegel said. Plus, the vast dollars already being poured into the channel limits how much more companies can realistically spend on it.

In the case of direct mail, Biegel expects costs to stay steady and a projected 1% growth to come from volume increases “for the first time in a long time.”

The big surprise in 2015 will be email. Expect to see email marketing spending, which grew 3% in 2014, jump 9.7% this year. The reason? Better personalization.

   

Areas to watch –

Social targeting using CRM data “exploded” in 2014, Biegel said. Expect marketers' focus in that area to continue in 2015. “Social IDs matter, but we're not quite there yet,” he said. “When we do get there, we'll have powerful data for personalization.” Biegel predicts that marketers will overcome most of the obstacles in this area this year because of the dollars they've invested in social display and search.

Device type will decrease in importance; marketers will care more about the particular audience they're targeting.

Beacons will proliferate as marketers realize their true benefit: data. According to Biegel, beacons won't be just about push; they'll be about the reams of customer data marketers can collect from them to use for such activities as retargeting. He expects that the budget for beacons could shift from promo budgets. “There's enough waste there to fund a whole beacon [rollout],” he said.

The integration of off- and online data accelerated in 2014, and companies will continue to merge that data as more of them adopt data management platforms. DMPs are like an extension of a company's marketing database, Biegel said, noting that the integrated data helps marketers deliver a more relevant customer experience. “Over the next couple of years DMPs will be a must-have,” he said.

It's still early for native advertising, Biegel said. The ethics debate related to native is still waging on; but “content is better than ads,” he said, so marketers are moving ahead. “The good and bad are still being worked out.”

The marketing-tech landscape –

Campaign management platforms are evolving to support omnichannel marketing. One enabler of that evolution has been the massive M&A activity of 2014. There were more than 2,900 deals last year—a 30% year-over-year increase—that amounted to about $126 billion in deal value.

That doesn't mean the marketing-tech landscape is shrinking; in fact, just the opposite is happening. “For every company getting picked off, venture capitalists are funding 10—of which two will survive. So, we're getting continued growth,” Biegel said. “It's not a static environment; marketing breeds innovation.” He expects to see more deals in 2015—expensive ones with high price tags, but backed by deep due diligence.

Red flags –

GDP growth for 2015 is predicted to be 3%, so ad spending will be higher than ever, Biegel said. But, he added, the lack of a major election or global sporting event, as well as the financial markets' concern about such issues is interest rates and global growth, will have CEOs keeping a close eye on budgets. Otherwise, he said, 2015 could have seen even greater predicted growth.

Despite those concerns, marketers across the globe are feeling positive. According to research from Winterberry Group, 77% of marketers surveyed are confident in the growth of data-driven marketing over the coming year.

Loading links....
close

Next Article in Marketing Strategy

Follow us on Twitter @dmnews

Latest Jobs: