At yesterday's Advertising and Media Outlook Update hosted by Universal McCann, MAGNA Global presented their current estimates and forecasts of expenditures on emerging media in the US.
A summary of these figures
A presentation on traditional ad expenditures from Universal McCann's Robert Coen was also given, as well as his semi-annual Insider's Report (see related story).
An outline of MAGNA Global's presentation:
EMERGING MEDIA IN CONTEXT
Venture capital activity reflects expectations of change, but traditional media dominates by a wide margin and young audiences are not abandoning it. "Packagers" (networks, publishers) continue to drive the industry. So although emerging media equals emerging opportunities, they suggest marketers look beyond early adopters. Change is constrained for most media because of business model issues; limits to market appeal; difficulty to change behavior and negative utility with more choice.
Media search tools have existed in many forms. Three players have come to dominate online search: Google, Yahoo and MSN. •E-commerce is a key driver of search spending and search spend reflects effectiveness for SMEs and dot-coms. Paid search should exceed 11 billion in 2008, led by more searches per person and better monetization.
Platforms include cinema, digital billboards and retail networks. More digital billboards and new digital networks drive growth, but most activity remains at the local level.
Social sites emerged in late 90s as potential substitutes for portals, but post-Geocities, emphasis has been on social connectivity. Growth is mostly share gains from other publishers and historically monetized as residual internet traffic.
Social Network growth is slowing, but will exceed 1 billion in 2008. Dollars are driven by volume of inventory and better monetization.
New media can dramatically affect an industry. The music industry is often cited as case study for the video industry and classified advertising provides another example. But TV won't be impacted as other media (yet). Online video spend is growing more than 50% annually, but is less than 1% of all TV. A significant increase in supply and advertiser interest is driving results.
Advanced TV (VOD, RFIs, iTV) has been slow to emerge. The user experience remains poor. Content is better, but limited. Advertising infrastructure still under construction. These components include unduplicated/unique reach; uniform technological standards; establishment of creative formats; smooth buying process; provision of robust user data; high-quality service / product standards.
VOD is the largest component, followed by RFIs (requests for info) and other iTV. VOD is likely to generate 85 million in 2007, 105 million in 2008.
Mobile (WAP, video, SMS, LBS) attracts great interest, but makes few dollars today. Infrastructure issues are potentially similar to advanced TV. Many new products are compelling, but the scale remains too small for most national advertisers given their broader objectives. Growth is driven in near-term by introduction of new supply. Carriers are opening up "decks" and new mobile ad models.
Gaming growth is likely slower than for other new media. Many advertisers remain interested, but few invest.