2012 Marketing Investments Forecast to Grow Only 0.9%

2012 may be the last year in this decade in which marketing communications will increase, according to a new economic forecast being published next week by Jack Myers Media Business Report. Myers is forecasting growth of total marketing investments of only 0.9% in 2012, down from Myers original estimate of 2.8% growth originally published in January 2011. Myers is also announcing our preliminary report on 2011 marketing investments, estimating 0.3% growth, down from Myers original year-ago forecast of 1.4% growth. Myers' analysis includes details on 62 media and marketing categories, including both legacy and digital revenues for broadcast and cable television, magazines, newspapers and consumer sales promotion. For the past 25-years, Myers' economic forecasts of advertising and marketing investments have been considered the industry's most thorough and accurate. Myers provides the only economic report that incorporates all advertising and marketing categories in which marketers invest communications budgets. The Myers report includes data for online display advertising, search marketing, online video, mobile and social marketing.

Total marketing budgets are estimated to be $595.6 billion in 2012, of which $175.4 billion will be invested in television, radio, print and out-of-home advertising categories. Over the next several weeks, Myers will share details and insights and will issue the full ten year 2010-2020 data and forecast for all 62 categories. I'm projecting that 2013 will be the first year of a long-term erosion of marketing budgets, with total investments declining from $595.6 billion in 2012 to $564 billion in 2020. There are several dynamics, primarily driven by marketers' reduced focus on direct marketing, consumer sales promotion and retail trade promotion. Media investments will be impacted by increased availability and viability of digital inventory driving a steady increase in advertising cost efficiency and a commensurate decline in total spending as marketers shift a growing share of their budgets to digital investments. New sources of media and marketing research will also enable marketers to make more educated investments based on customized metrics and return-on-investment.

While legacy media such as newspapers will fail to replace declining traditional ad revenues through digital growth, broadcast network and cable TV will generate significant overall growth throughout the decade, driven by the industry's aggressive refocusing on digital distribution and TV Everywhere. Investments in yellow pages, local broadcast television, business-to-business publications, offline public relations and custom publishing will also decline.

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