The Decline of Advertising: An opportunity for smart marketers

Forrester just released their five year forecast for US Interactive Marketing and it is an interesting read.  Five year forecasts are always dicey in today’s new media world. How many people in 2004 predicted the most talked about politicians in 2009 would be Barack Obama and Sarah Palin?  Zero.  About the same amount of people in 2004 who predicted the country would come to a standstill to watch and follow Michael Jackson’s memorial on Face book and Twitter. 

However, the numbers confirm and quantify what most of us already know – the amount of dollars to be spent on interactive marketing are growing fast and taking share from traditional media.  Overall, search marketing will be the biggest component, and Mobile (27% CAGR) and Social Media (34% CAGR) will grow the fastest.  All of these media/technologies are game changers in terms of information/content consumption and marketing.  Anyone who has taken a spin around an iPhone can see just how radically our content consuming habits will change.  And, marketers must follow suit.

Here is a quote from Forrester’s Shar VanBoskrik’s blog:

But to me, the most interesting takeaway from the research is that overall advertising budgets will decline.  Yep.  With dollars moving out of traditional media toward less expensive and more efficient interactive tools, marketers will actually need less money to accomplish their current advertising goals.   But reasonable marketers won’t relinquish budget because their programs are running too efficiently. Instead, marketers will allocate unused advertising dollars into investments like innovation, research, customer service, customer experiences, and marketing-specific technology and IT staff, in order to further marketing’s strategic influence within their companies.

If I may add my two cents – this gives marketers and brands the opportunity to become the media.  By creating their own original content, brands can build trust and affinity with customers and prospects.  The budget and technology now exists for marketers to totally bypass traditional media and ad agencies and talk directly to customers.  Content is what will fuel search and social media, so the opportunity for companies to engage in content marketing has never been greater.  I may not be bold enough to predict what the marketing world will look like in 2014, but I do know one thing.  I would not invest in any traditional ad agencies any time soon.