The report is “another indicator that our members have to improve their digital positioning,” said Gordon Hughes II, president-CEO of ABM, which has more than 300 members. He said the full-year BIN numbers were not a surprise.
“Certain ad categories will grow, some will not and others will be flat but, at the end of the day, b-to-b media is still an $11.40 billion business and it is not going away,” he said. “The reason our members are continuing to smile is because custom media is growing 20% a year, digital media are growing more than 20%, and events and trade shows are growing 6%. The only thing that’s not growing is pages, but I’m not feeling anxiety about that at all.”
Some of the stronger ad-spending categories in 2006 included architecture, design, lighting (up 9.91%); building, engineering, construction (up 8.09%) and automotive (up 7.82%). Among the 22 advertising categories tracked by BIN, spending increases trumped spending declines 14 to eight.
“The [engineering] category went though some lean years post 9/11, but now advertisers are letting a little sunshine in and reinstating budgets,” said John Petersen, publishing director at Penton Media’s Design Engineering Group. “Budgets are climbing back to pre-9/11 levels, and we’ve had about a three-and-a-half-year run on print increases.”
Weaker ad categories included computing, software, telecomm (down 6.67%); restaurants, foodservice, lodging, gaming (down 5.83%); and agriculture (down 5.12%).
Spending on computer-related media products is expected to improve this year, but not necessarily for the print component, said Bob Faletra, president of CMP Technology’s Channel Group, which includes CRN, VARBusiness, Channel Weband the Institute for Partner Education & Development.
“Customers are getting to our audiences through events, online vehicles, research and [an increasing number] of work-flow tools,” he said. “Print is the most challenged.” In 2006, about 50% of CMP’s revenue was gained through print, down from 66% in 2005. Events generated about 32%, up from 17%; online products generated 18%, also up from 17%.
Tom Kemp, a managing director with private equity firm Veronis Suhler Stevenson and former chairman-CEO of Penton Media, said it was important to put the BIN numbers in perspective.
“What the numbers don’t reflect is the overall health of b-to-b media,” he said. Ad pages and revenue represent “only one part of the b-to-b media channel for those b-to-b media companies that are getting more into events and diversifying their revenue streams.”
Kemp echoed Hughes’ comments about the explosive growth of “customized marketing,” which encompasses custom media products, face-to-face events and online messaging.
“When you look at the overall size of the sector, it’s still about an $11 billion business and it’s still substantial,” Kemp said. At the same time, b-to-b publishers can ill afford to rely on their legacy, he said. “If you’re a b-to-b media company, you better be developing programs beyond traditional print display advertising," he said.