Above-the-line marketing spending, which encompasses brand marketing designed to reach a mass audience, will grow at a steady clip from its $200 billion level in 2003 to around $250 billion in 2007.
But below-the-line marketing, which focuses on targeted, customer-centric communications, measurable results, and advertising with a strong return-on-investment component, will grow even faster. With increases of 7.8% seen annually since 2003, below-the-line expenditures will amount to $550 billion by 2007, according to a study from strategic consulting firm Winterberry Group.
Winterberry, in conjunction with marketing services provider V12 Group, isolated several factors contributing to consumers’ embrace of targeted, below-the-line messages.
These include diversified consumer demographics, which decrease the influence of traditional mass-media one-size-fits-all marketing messages. For instance, ethnic minorities, which controlled $647.4 billion — or 15.6% — in total expenditures in 1990, directed $1.3 trillion — 19% — by 2001.
Another factor is that consumers have also become more sophisticated in controlling their access to messages from all channels. This is enabled by mechanisms such as e-mail filters, the federal do-not-call-list and digital video recorders. At the same time, technology advances such as faster Internet connections, variable digital printing and advanced search engine algorithms make consumer/marketer interactions easier, faster and more relevant.
The study showed that clients are pressuring advertising agencies to deliver personalized campaigns with measurable return-on-investment components, noted the study. This is key, considering the increased preponderance of marketing messages.
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