61% of Marketers Moving Online Dollars From Direct Response to Brand Advertising

Source: April 22, 2013 by MarketingCharts staff

Vizu-Online-Advertising-Outlook-Apr2013Marketers plan to split their online advertising between direct response and brand advertising initiatives, with 18% of marketers focused on each, and the remaining 64% employing a mix, according to [download page] results from the “2013 Online Advertising Performance Outlook,” a survey fielded by the CMO Council, with findings developed by Vizu. But those advertising dollars look like they’re shifting from direct response to branding initiatives: 61% said they are re-allocating budgets away from direct response to brand advertising initiatives.

Indeed, the proportion of marketers looking to up their digital brand advertising spend outweighs the proportion planning to increase their direct response spending (61% vs. 53%).

Media sellers take a similar outlook: 89% expect sales growth in brand ad sales, versus 80% who believe they’ll see growth in direct response ad sales. Overall, 60% of media sellers believe that most of their online ad dollars will be generated by brand advertising over the coming year.

Driving this growth in brand advertising is increasing consumer consumption of digital media, with the researchers suggesting that “brand marketers (and their advertising dollars) will follow them” to those channels, whether they be online, tablet, mobile, or connected TV.

Looking at where spending increases are most commonly projected, the survey reveals that 70% of brand marketers expect to up their spending on social media advertising, while similar proportions will increase mobile (69%) and video (64%) ad spend. Around half will keep their investments in rich media and standard display flat. Those patterns tally in some regards with recent findings from the IAB and PricwaterhouseCoopers, which showed mobile (+111%) and video (+28) ad revenues growing quickly last year, while display growth was right around average at 13%, and rich media revenues were down about 25%.

Digital branding dollars won’t all come at the expense of direct response, though. 48% of marketers said they will be shifting some budget from TV to online video this year, with 18% reporting their shift to be a “material amount.” That also aligns with recent research from Ooyala, which found that 72% of online video buyers increased their budgets for the medium over the last year, with 39% drawing those budgets from TV, with the amount of TV spending cannibalized averaging out at 100%.

About the Data: The Vizu data is based on findings from the 287 senior brand leaders, 176 agency executives, and 152 publishing representatives that took part in an online survey fielded during January and February 2013.

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