Traditional and New Media: You Need Both (Brian Kratkiewicz Commentary)

by Brian Kratkiewicz  on Monday, Jan. 7, 2013 12:00 am  

Brian Kratkiewicz

What is the current state of the media in the U.S?

Advertisers now spend the majority of their dollars with traditional media, where consumers spend the majority of their time. However, Internet ad spending and consumer use of online media through computers, mobile devices and tablets are growing faster than any other medium.

In the Cranford Johnson Robinson Woods third annual State of the Media report, we provide an in-depth analysis of the trends taking place medium-by-medium. Following are a few findings.

• Television drives traditional media and will continue to dominate use and spending. Research firm eMarketer reports that adults spend 278 minutes, or 40 percent of their media time, each day watching television. The report also states that television currently receives $64.5 billion (39 percent) of all ad dollars. The ad industry must keep an eye on alternate viewing options such as mobile devices and online video services as they may start to erode TV’s dominance.

• Online continues to grow and steal ad revenue and consumption from traditional media, while the massive growth of video viewership is beginning to slowly take dollars from banner ads. eMarketer states that online is now the second-most used medium, with consumers spending 173 minutes a day online. Online is also second in terms of ad spending with $34.7 billion (21 percent) of all spending. That is projected to increase to $42.8 billion (23 percent) by 2015. The biggest challenge that online publishers and marketers face is how to best define success in terms of online metrics. Is a click on a banner ad more important than a view of a 15-second video?

• As smartphone and tablet penetration and capabilities evolve, both ad revenue and consumption will shift to mobile. Time spent with mobile is currently 82 minutes a day. However, it’s the fastest-growing medium, with time spent having grown by 53 percent over 2011. While ad spending is currently small at $2.6 billion, it is projected to grow by 252 percent by 2015 to $9.2 billion. As the mobile-savvy younger audience matures, mobile marketing will become even more important.

• While online radio and satellite radio are growing, broadcast radio continues to dominate listening. Unless automakers decide to give away broadcast alternatives for free or as part of the price of their cars, broadcast will continue to dominate.

• Although printed magazine circulation is still struggling, digital circulation has helped stabilize circulation overall. Magazines should continue to be a viable advertising medium. Surprisingly, the fastest-growing magazine in the U.S. is Game Informer, which reaches a young audience interested in video and online gaming.

• Newspaper ad revenues and readership are slowly falling. The newspaper industry must grow its digital readership at a faster rate and attract younger readers.

• Digital signage will continue to drive outdoor growth as it appears in more locations. Traditional billboards will, however, dominate the ad landscape.

• Social media is mass media and a mandatory element of all balanced marketing mixes. It allows marketers to interact with their customers.

• Two primary factors could change the media landscape: inexpensive tablets and advanced Internet-ready televisions. Mobile use would explode if extremely inexpensive tablets became available. Even the lower $200 starting price for tablets has kept many consumers from entering the market. If a technologically sound $50 tablet hits the marketplace, penetration could surge and change everything.

• The capabilities of Internet-ready televisions will also drive the future of media. TV sets are inching closer to acting like true computers and creating more entertainment options. If TVs and computers become one, as Apple has hinted at, the media landscape will tilt on its axis.

The bottom line is that marketers need to implement well-balanced media mixes consisting of traditional and online media. As media audiences become more fractured due to having more entertainment opportunities, marketers will need to make sure they have a presence everywhere that consumers are spending time.

Brian Kratkiewicz is SVP of media/interactive at Cranford Johnson Robinson Woods of Little Rock, a full-service communications agency.



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