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Direct & Integrated Marketing Roundtable

Monday, June 8, 2009

Interactive marketing spend takes a hit first time in 7 years

The numbers are in from the IAB and for the first time since 2001, interactive marketing spend is actually down versus the same point in time one year ago. But before we get all excited, let's look at the numbers over the past year in total.

To be fair, interactive marketing spend throughout 2008 has been relatively flat and now it has taken its first dip. The graph below from the IAB website clearly shows this fact.


Source: www.iab.net

And when we compare this trend for interactive marketing spend to traditional marketing spend, we notice about a year lag. Traditional marketing spend actually started to decline about a year ago when the recession first hit.

So does this lagging relationship of traditional versus interactive marketing spend make sense?

Let's think about it.

When the recession first hit about a year ago, the first thing to get cut was traditional advertising. Marketers were forgoing expensive direct mail acquisition campaigns in favor of cheaper email retention efforts. Additionally, needing to prove ROI to upper management, advertising dollars also began to shift from less measurable sources like print advertising to those more measurable like search.

Now, let's fast forward to today. The economy is still showing signs of trouble. Budgets need to be cut again. What's left? The answer -- interactive.

Will this drop in interactive marketing spend continue into the second quarter? Will Forrester's $26 billion spend estimate for 2009 interactive marketing spend be adjusted downward? I hope not. I guess we will all know in a few months.

Lets all keep our fingers crossed.

Perry

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