Marketers will place more video and social media ads, Forrester says
Interactive marketing spending in the U.S. will grow at a 27% annual rate from 2007 to 2012, with the fastest growth coming in online video ads and such emerging marketing vehicles as social media, widgets, mobile and gaming, Forrester Research predicts in a new report.
Total interactive spending will grow from $18.4 billion this year to $61.3 billion in 2012, according to the report “US Interactive Marketing Forecast, 2007 to 2012” by Forrester analyst Shar VanBoskirk. Search engine marketing will remain the largest category, growing at a 26% rate from $8.1 billion to $25.3 billion over the next five years. But online video marketing will grow at the highest rate, 72%, from $471 million to $7.2 billion. Emerging channels will grow at a robust rate of 59%, from $1.0 billion to $10.6 billion, Forrester predicts.
The forecast suggests that marketers increasingly are aligning their budgets to match the growing amount of time consumers spend online, VanBoskirk writes in the report. “Interactive marketing’s meager 8% share of advertising spend is poised to grow as advertisers invest to better match the 29% of media time consumers spend online,” she says. By 2012, she predicts, interactive marketing will account for 18% of all advertising spend.
Marketers believe interactive channels will become increasingly effective over the next three years, the Forrester report says, citing data from a survey of 235 companies. 86% say marketing through social media will become increasingly effective, 84% search engine marketing, 83% mobile and 83% online video. By contrast, only 21% say direct mail will product better results, 16% radio, 11% magazines and 6% newspapers.
Keywords continue to get more expensive as search engine marketing becomes more popular, the Forrester report says. Six times more keywords cost more than $1 per click-through in January 2007 than a year earlier and the average cost per keyword rose by an average of 33% per month during the first three months of 2007. “But,” VanBoskirk writes, “many still spend with abandon because search is their most efficient channel—even with more expensive keywords.”
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