NetNewsCheck
By Staff
June 10, 2015
A Borrell Associates survey of small business owners released this morning finds that "advertising as we’ve come to know it is in decline." The report, based on a survey of 7,228 small businesses, shows an acceleration in upward and downward trends for media buying, with more respondents planning to increase digital budgets than there were in 2011 and 2013 surveys, as well as more planning to abandon traditional media.
A Borrell Associates report released this morning finds that local advertising is at a tipping point, as the survey of 7,228 small businesses shows that traditional means advertising is on the decline.
Key findings include:
"We’re at a critical juncture in media history, one that is redefining the landscape so quickly that we’ve obviously reached a tipping point. Usage of online media has become ubiquitous and necessary, and usage of traditional media advertising has become niche and optional. It used to be the other way around.
Our survey of 7,228 SMBs indicates an acceleration in upward and downward trends for media buying. More have told us they’re planning to increase digital budgets than we saw in our 2011 and 2013 surveys, and more have told us they’re planning to abandon traditional media.
Meanwhile, 82% of SMBs have established their own media channel in the form of a website or social media page. We’ve found that 72% of them are purchasing digital services to support those channels, spending far more on those efforts than on basic advertising.
As a result, advertising as we’ve come to know it is in decline. We found clear evidence of that in IRS tax records. If businesses were devoting the same percentage of this year’s gross revenues to advertising as they were 10 years ago, the advertising economy would be $56 billion richer.
This year, online media shimmied to the top of the local media food chain, appealing to the largest percentage of local advertisers and taking the largest share of ad budgets of any other media. It was a position held by newspapers since 1704.
Over the next 12 months, the gap will almost certainly widen to the point that all traditional advertising channels — print, broadcast, outdoor and mail — begin to look like niche support mechanisms to a local businesses’ digital marketing plan.
We are clearly at the end of Golden Age of Advertising. Both the present and future belong to digital and the targeting capabilities it offers. We are witnessing the dawn of the Golden Age of Geomarketing. It’s a complicated environment, but the good news is that millions of local businesses are in need of marketing leadership. Their digital savviness is lacking, as we outline in this report, and they yearn for someone with a marketing plan that makes sense of it all."
Key findings include:
- Local broadcast is not dying. Survey shows twofold increase in percentage who say they plan to increase radio or TV budgets in next 12 months.
- Native advertising (a.k.a. sponsored stories) is catching on fast: 25% of SMBs now buying, and satisfaction rates are high.
- 72% of SMBs now buy digital services. In fact, they’ll more readily buy social media management than they will banner ads.
The report's executive summary reads:
Our survey of 7,228 SMBs indicates an acceleration in upward and downward trends for media buying. More have told us they’re planning to increase digital budgets than we saw in our 2011 and 2013 surveys, and more have told us they’re planning to abandon traditional media.
Meanwhile, 82% of SMBs have established their own media channel in the form of a website or social media page. We’ve found that 72% of them are purchasing digital services to support those channels, spending far more on those efforts than on basic advertising.
As a result, advertising as we’ve come to know it is in decline. We found clear evidence of that in IRS tax records. If businesses were devoting the same percentage of this year’s gross revenues to advertising as they were 10 years ago, the advertising economy would be $56 billion richer.
This year, online media shimmied to the top of the local media food chain, appealing to the largest percentage of local advertisers and taking the largest share of ad budgets of any other media. It was a position held by newspapers since 1704.
Over the next 12 months, the gap will almost certainly widen to the point that all traditional advertising channels — print, broadcast, outdoor and mail — begin to look like niche support mechanisms to a local businesses’ digital marketing plan.
We are clearly at the end of Golden Age of Advertising. Both the present and future belong to digital and the targeting capabilities it offers. We are witnessing the dawn of the Golden Age of Geomarketing. It’s a complicated environment, but the good news is that millions of local businesses are in need of marketing leadership. Their digital savviness is lacking, as we outline in this report, and they yearn for someone with a marketing plan that makes sense of it all."
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