Some Agencies Focusing More on Traditional Media

May 7, 2012

strata-agency-focus-traditional-media-may2012.jpgDigital may be getting most of the buzz these days, but many leading ad agencies aren’t forgetting about the value of traditional media, details STRATA in May 2012 survey results. TV remains the top advertising choice for 54% of the respondents (the highest proportion since Q1 2009), more than double the proportion citing digital to be their top medium (24%). And although an impressive 79% of respondents are more focused on digital compared to a year ago, some are also getting more excited about traditional media: 30% are more focused on out-of-home (OOH), with spot TV (26%), radio (25%), and even print (11%) seeing an increased level of attention from a significant proportion of agencies. Overall, although 21% of agencies feel that they will spend more on digital than traditional some time in the next 1-3 years, 46% say their digital spend will never overtake their traditional media spend. This is a significant jump from 38% of respondents in Q4 2011 who felt that way, and comes after March 2012 survey results from DataXu revealed that almost three-quarters of enterprise decision makers report a shift in budgets from traditional advertising to digital in the past year.

Social Media Challenges Display in the Digital Space

Data from the STRATA survey indicates that within the digital advertising space, social (69%) is challenging online display (71%) as the top option, beating out search (65%) in the process. Facebook (85%) still takes top billing in the social category, with YouTube overtaking Twitter for the second spot, and Google+ coming in fourth, at 24%.

Ad Economy Appears Positive

Agencies appear to have a fairly upbeat outlook, with 47% seeing their business increasing this quarter compared to the same time last year, against just 11% who see it decreasing. Almost two-thirds of the respondents said their clients’ approach to ad planning is the same as last year, while only 20% said their clients are making cuts to planning, the lowest proportion to report this since 2008.

1 in 5 agencies feel that their business and the economy is in a strong growth period, with an additional 23% saying that will happen by later this year. This optimism translates to hiring, with one-third planning to add new staff.

Other Findings:

  • 43% of agencies report that they will compete for TV ad space with political advertisers rather than go to an alternative medium.
  • 86% said they will have either the same (51%) or more (35%) advertising spend on political compared to the 2010 election year.
  • When placing a campaign, 51% of agencies use more than 3 mediums, while 24% use 3 and 19% use 2.
  • iPhones are the top mobile devices of choice among advertisers, cited by 75%. Although Android is second, it fell from 71% of respondents in Q4 2011 (see link above) to 57% in Q1.
  • About 1 in 2 agencies say that their digital measurement tools are effectively meeting their campaign needs. This sentiment may not be shared by clients, though: according to the DataXu report released in March 2012, 8 in 10 enterprise decision-makers either agree (32%) or are neutral (45%) about the analytical skills possessed by their agency that can help them allocate marketing spend appropriately. The majority are neutral about their agencies’ capacity to provide them with the tools needed to optimize their digital marketing efforts.

About the Data: STRATA conducted the survey of advertising agency respondents in Q1 2012, and had more than 90 respondents.

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