Outlook 2014: Marketing Spending to Rise
Bruce Biegel, senior managing partner, Winterberry Group
At Direct Marketing Club of New York's Annual Outlook luncheon, keynote speaker Bruce Biegel told a rapt audience that spending on “direct and digital” marketing will increase about 5.5% in 2014. Biegel, senior managing partner for Winterberry Group, also said that the management consulting firm expects U.S. digital ad spending to reach $50.6 billion in 2014, up 14% over 2013.
Biegel, who began his presentation with a review of last year, pointed out that 2013 started slow due in part to a lack of stimulus in such areas as politics and entertainment. He added that gross domestic product (GDP) growth came too late to drive significant consumer spending, and the holidays were short, so there wasn't much growth in 2013 in terms of marketing spending. For example, spending on measured media (e.g., outdoor, print, TV) increased only 1.8%, to $123.5 billion. The bulk of new marketing spending in 2013 was in digital channels. While overall “direct and digital” spending increased only 7.2% in 2013, to $133.4 billion, spending within such digital subcategories as display (35.4% growth), email (11.1%), search (12.9%), and social technology and services (50.0%) spiked. Traditional direct channels also grew in 2013, albeit minimally; for example, direct mail saw a 1.2% increase.
“About 20 to 23 percent of marketing spending overall is digital spend,” he said. “It's still lagging, but we're starting to see marketers put money where the media is being consumed.” Winterberry's data put 2013 U.S. digital advertising spending at $44.4 billion.
So what's in store for 2014?
This year should take off out of the gate slightly faster than 2013 did, Biegel said. “The U.S. economy is expected to expand, and GDP is estimated to rise 2.8% [according to JPMorgan],” he said, adding that this year's Olympics will drive some marketing spending. “However, GDP growth isn't enough to drive accelerated growth. Everything's doing OK, but it's just slow.”
To hear more from Biegel on data and privacy issues, and on how marketing and IT should collaboratively "own" customer data, join us at the upcoming Marketing&Tech Partnership Summit in NYC on January, 28, 2014.