Our page 1 headline—”Weak economy forces revised ad forecasts”—shouldn't come as a surprise. The story, by Senior Reporter Kate Maddox, cites among other studies a reduced global forecast by media agency Carat, which earlier this month lowered its global estimate for ad spending this year to 4.9%, from a March projection of 6.0%. In North America, Carat reduced its 2008 estimate to 2.1%, down from 3.8%.
Likewise, our annual Top 100 Advertisers report (page 31) finds a spending reduction of 1.9% last year, to an estimated $6.05 billion.
It's obvious that economic weakness is helping drive spending to the most-trackable advertising channels. No surprise there.
What's less obvious is the growth in custom publishing. According to research from Junta42, a division of Z Squared Media, and BtoB, custom content now represents 29.4% of b-to-b marketing budgets. Likewise, the Custom Publishing Council and Publications Management find organizations on average spend 27% of their total marketing dollars on custom content activities.
Nor are these products limited to print. Custom publishing companies, as well as the custom divisions of b-to-b media companies, are busy producing custom online material, from white papers and microsites to blogs, social networks and webcasts.
Is it peculiar that just when readers are participating and influencing the content they consume as never before, marketers are using nonjournalistic content to deliver their messages? The seeming paradox can be explained by the very glut of content that's available. Buyers researching products and services want everything they can find, which includes both traditional and custom media, as well as the opinions of their peers, which they can solicit on social media sites.
What's the impact of all this on traditional media? First, an ongoing problem for media companies is that only a portion of the shift to digital is headed their way. BtoB's own spending surveys over the years have consistently found that marketers spend the lion's share of their interactive budgets on their own digital domains and outbound online products, followed by spending on search engines, both SEM and SEO. What's left goes to their media partners—either directly or through third parties such as online ad networks.
What's the future role of the world's traditional media companies? This was the focus of much discussion at the ABM/FIPP World Conference 2008 in New York last week. Some of our coverage from that event appears in this issue, starting on page 3. The rest can be found on btobonline.com.
The evolving role of media companies and the editors who work for them is a topic of heated, emotional debate within journalism schools, professional societies and the annual corporate retreats of media companies. Working reporters and editors certainly know their roles have expanded dramatically in the last few years, but the ones I speak with are simply too busy managing ever- increasing portfolios of print, digital and event properties to spend much time theorizing about their industry's future.
To survive, I believe media companies will need to become more highly sophisticated, strategically and technologically, about analyzing their audiences and creating content and applications that serve their needs. B-to-b advertisers have always sought media partners with deep understanding and reach into target markets. The danger for traditional media companies, as suggested by the growth in custom publishing, is that advertisers are starting to take matters into their own hands.
Ellis Booker is editor of BtoB and BtoB's Media Business. He can be reached at [email protected]