Marketers seeking reasons for optimism in 2012 should cast their eyes toward Washington, DC and London. This year's U.S. Presidential election, along with the summer Olympics, will help boost spending on above-the-line channels such as broadcast media, periodicals and outdoor venues by 3.5% to an estimated $123.1 billion, according to Winterberry Group's Outlook 2012 for direct and digital marketing study.
The forecast for below-the-line mediums, including direct and digital channels, is even more optimistic. Winterberry projects spending among these as rising by 5.2%, to $227.2 billion.
Unsurprisingly, digital spending is seen as having the largest potential gain – 17.4%, to $40.6 billion. Within this category, the youngest channels are showing the biggest increases: Mobile spending is anticipated to jump 50.2%, to $1.8 billion, while social technology and services (a category that does not include social display and social search spending) will rise by 33.3%, to $2.1 billion.
Online display spending will increase 20.2%, to $14.8 billion, and search expenditures will rise by 12.4%, to $19.8 billion. Email marketing will grow at only a slightly faster rate than search (12.5%), but this growth is to a much lower total: Email spending in 2012 will reach $1.8 billion, according to Winterberry.
That's not because marketers are abandoning the channel. "Email volumes are up, but per-email costs keeps going down," said Winterberry Group's managing director Bruce Biegel at a recent Direct Marketing Club of New York event. "Hygiene, management and segmentation is where the spending is."
Direct response broadcast (radio and television) is more than holding its own: These channels' fortunes – 9.1% growth, to $27.7 billion – represent the second-largest jump.
There's a nice surprise for direct mailers: Among all the categories measured by Winterberry, mail will remain the largest, with 2.5% growth in 2012 bringing spending on it to $46.9 billion.
The results offer a trend worth noting within direct mail. According Biegel, while marketers' use of first class mail continues to fall, it's dropping at a slower rate than in years' past. During 2011, for instance, mailers sent out $27.2 billion in first-class mail. This was down from the $27.7 billion in first class postage they used in 2010, but it's not as precipitous a drop as was seen between 2009 and 2010. In 2009, mailers used $29.6 billion in first-class mail.
Marketers' first class mail spending has been steadily declining since 2007, when it amounted to $35.3 billion.
In contrast, standard mail's fortunes have been steadily, albeit slowly, rising. No, they're not at 2007's level, when they reached $102.7 billion. But since 2009, when marketers spent $80 billion in this category, standard mail has made gains, reaching $84.4 billion in 2010 and $85.8 billion in 2011.
What does Winterberry foresee for 2012? Biegel outlined 10 "critical themes," including:
* The loosening, on a global scale, of economic purse strings and increased investment.
* Continued consolidation and contraction within traditional mail-focused enterprises, including the U.S. Postal Service and mid-sized commercial print suppliers.
* A heavier focus on "deep, informed media-appropriate content" as channels proliferate, and an increase in pay walls among premium publishing sites.
* The continued disappearance of digital agencies, as they are merged into integrated agencies, and the vanishing of traditional-media-only agencies.
* Mobile being seen not as a channel, but a way of life, and marketers realizing there is more to the medium than consumers using it to access their content. Marketers will have to acknowledge that the location-based functionality of mobile will necessitate a rethinking of their messages.
* The true reward of marketers' using social media will be in the data it yields. This will come alongside increasing conflict between marketers and intermediaries over who should have access to, and custody of, the customer data.
* The heightened priority of data governance and management across an entire enterprise.
* The continued intertwining of marketing and IT departments, and the increasing complexity of relationships between marketers, agencies and marketing service providers.
* More merger and acquisition activity, especially among the data management industry. (Note: For a separate review of Winterberry's anticipated changes to the data landscape, click here).
* Finally, 2012 will NOT be the year of mobile – or social media, or tablets, or anything else. It will be the year of integration, and this trend will be fueled by increasing power of, and need for, attribution, analysis and data for cross-channel targeting.