Harvard Business Review reports that traditional advertising is headed for growth for the first time in a decade. Now is not the time to think "digital versus print". Instead, it's time for clever use of all media.
According to an article in Harvard Business Review, a ten year downshift in traditional advertising spending is now broken. In February 2022, marketing directors in the CMO Survey predicted that their traditional advertising spending was about to increase.
First, let's look at which industries are driving this shift. Then let's look at some of the reasons behind the change. Why does the interest for traditional media come back now, according to Harvard Business Review?
For the last decade, marketers have consistently predicted that their traditional advertising spending would decline, according to Moorman, Ryan and Tavassoli, who are the writers behind the article. "Digital marketing technologies and their ecosystems have dominated growth in marketing budgets," they say, and continue "However, recent evidence suggests that a shift is underway."
Consumer services lead the trend
The CMO Survey shows that the business-to-consumer service companies lead the traditional media comeback trend. Business-to-consumer companies are the ones that expect to make the largest increase in their spending on traditional advertising, as much as +10.2%. Consumer product companies also expect an increase, by +4.9%.
For all the survey respondents, regardless of their industry, the planned investments in digital communication are still expected to increase, but there has been a change in focus. The investments in data analytics grew by nearly 40% over the last year. Data analytics now stands for the largest marketing investment within digtal communication, the survey shows. And at the same time, the number of marketing directors who stated that digital marketing had contributed highly to their company's performance during last year decreased by over 10%.
"And somewhat ironically, companies that earn 100% of their sales through the internet are leading this inflection — predicting an 11.7% increase in traditional advertising spending over the next 12 months," Moorman, Ryan and Tavassoli point out.
Combining digital and offline
The respondents in the CMO survey were also asked about their largest digital marketing challenges. Their top priority for now is to grasp the combined influences from digital and traditional marketing communication on their markets. Integrating customer data across all touchpoints, and combining digital and offline data, are the top challenges mentioned in the 2022 report summary.
This 28th Edition of The CMO Survey finds that marketing budgets as a percent of overall budgets rise to 11.7%, resetting to pre-pandemic levels. Yearly growth in marketing spending is over 10% for only the second time in a decade and is predicted to rise further over the next year to 13.6%.
"When used together, traditional and digital marketing can reach more audiences, build and keep trust, and motivate buying from consumers who otherwise might tune out marketing messages," Moorman, Ryan and Tavassoli from Harvard Business Review conclude.
The CMO Survey
The CMO Survey collects the opinions of top marketers in order to predict the future of markets, track marketing excellence, and improve the value of marketing in organizations and in society.
The survey participants are 2500+ marketing leaders working at U.S. for-profit companies, representing a wide selection of industries and company sizes.
Partners behind the study are AMA - The American Marketing Association, Deloitte, and Duke University’s Fuqua School of Business.