The Big Story of 2013: Digital Spending

Medialife Magazine Media economy Online Will Rise 18 Percent to Nearly a Quarter of All Spending By Toni Fitzgerald December 4, 2012 With the fiscal cliff looming and the recovery from the recession still bumping along in fits and starts, there are many things that are uncertain about ad spending in 2013, but one thing that’s not is the increasing role of digital in the media equation. Next year total ad spending in the U.S. will be up 3.5 percent, according to a forecast released today by ZenithOptimedia. By contrast, digital will grow by 18.1 percent. That's triple the growth rate of the second-fastest-growing media, outdoor and cinema, both at 5 percent. That hot pace is on track with recent years, but what’s more interesting is that digital advertising now accounts for almost a quarter of all media spending, 22 percent. That's a huge milestone for a medium that accounted for only 14 percent three years ago. “Digital ad spending continues to be strong as consumers spend more time with digital media and advertisers look for new ways to reach them. The internet will continue to drive total ad growth in the U.S.,” notes the report. Total internet spending will hit $36.25 billion next year. Though television will still have the lion’s share of total spending at 38 percent, or $63.895 billion, internet will be a comfortable second. Digital is clearly drawing away some money from traditional media, most notably newspapers and magazines, as print becomes less and less relevant in a world where headlines are now delivered to your palm via smartphone. Digital media isn’t simply siphoning off ad dollars from other media. It’s also becoming an integral part of traditional media, which is trying to prove its continued relevance as screens accounts for a rising amount of media consumption. More and more, print publications in particular are looking to digital as their savior. ZenithOptimedia notes that the increased popularity of tablets, which about a third of Americans currently own, is giving the magazine industry new hope for increased revenue streams. “As newsstand options expand, publishers will be able to capitalize on this increased accessibility and capitalize on this new revenue stream. Less than half of all publishers have presence on the iTunes newsstand, so there is definitely room for growth,” says the forecast. Within online there are two forms of media that will see explosive growth in 2013, again reflecting the increasing amount of time users are spending with digital media. Social media ad spending will jump 35 percent, to a record $4.61 billion, while mobile media will rise 51 percent, to $1.87 billion. Ten years ago those media were barely imagined, which certainly begs the question, what will be the fastest-growing segment of new media 10 years from now, and does it even exist yet