Exclusive Myers Analysis: Digital will Surpass 50% of Total Advertising Investments in 2020

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A new Myers analysis and long-term forecast of U.S. advertising and marketing communications investments establishes that digital represents a larger share of marketers' total ad spending than previously reported by industry sources. Total digital advertising investments in 2010 are forecast by Jack MyersMedia Business Reportto represent 16.4% of all advertising spending and 7.8% of total marketing budgets, including trade promotion. According to preliminary data developed by Myers, digital media in 2020 will surpass 50% of advertising investments and will represent more than one-quarter of total marketing budgets.

The new Myers Media Industry Financial Health Report, due to be released in early December, will completely recalibrate and reorganize traditional media advertising and marketing forecasts. The number of categories is being increased from Myers' previous base of 28 categories to 55. Most industry forecasters and financial analysts base their industry reports on 12 to 19 media/marketing categories. To accurately reflect the share of digital growth being invested in traditional media, the new Myers data will include separate traditional and digital advertising tracks for each medium. Most analysts currently bulk-report all online advertising as a single category, without accurately distributing it to the media companies that are actually generating the revenues. It has also been challenging to determine the digital revenues being generated by traditional media because sales organizations often allocate revenue to reflect internal corporate structures and financial goals. Companies that package multi-media programs often do not report revenues by medium. Myers has developed a variety of econometric models to estimate actual revenues by media category.

Most current digital media forecasts are based on a limited number of data suppliers and exclude the digital revenues of many large traditional media organizations. Myers new data, which forecasts a 3.2% overall year-to-year increase in 2010 marketing expenditures, separates online originated display and video advertising revenues from the revenues generated by traditional media. Broadcast television networks, for example, are projected by Myers to generate 4.1% of their advertising revenues from digital media in 2010 and 23.0% in 2020. By comparison, 10% of 2010 newspaper advertising revenues are projected to be generated from digital media, increasing to nearly 40% in 2020.

Myers' newly calibrated market analysis will estimate the total 2010 U.S. digital advertising market at nearly $32 billion dollars. All subscribers to Jack MyersMedia Business Reportwill receive the new forecasts in December and they will be available with passcode at www.jackmyers.com. Subscribers who have not received or misplaced passcode information should contact maryann@jackmyers.com.

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