Traditional Media Dominates CMO Holiday Ad Spend

December 2, 2011

bdo-holiday-marketing-advertising-spend-dec11.gif3 in 4 CMOs say they spend most of their holiday budgets on print advertising (44%), broadcast (27%), or outdoor advertising, including billboards (5%), according to a November 2011 BDO USA survey. Data from the “BDO Retail Compass Survey of CMOs” indicates that more CMOs are devoting the majority of their budgets to these categories than in 2010, while those spending most of their holiday budgets on online advertising has fallen from 27% to 23%. Among respondents at the top 100 largest retailers (12% of the sample), the picture is even worse for online advertising: just 17% say they devote most of their holiday budgets to this category.

Overall Budgets to Hold Steady

65% of CMOs responding to the BDO USA survey say that their 2011 holiday marketing and advertising budget is about the same compared to 2010, while 20% say that it is higher. A greater proportion of respondents at the top 100 retailers by annual sales revenue say their budget is about the same (83%), with none reporting a lower budget. Overall, CMOs report that their 2011 holiday marketing and advertising budget will rise 0.4% from 2010.

Search Proves Top Performer

bdo-online-customer-attraction-methods-dec11.gif53% of the CMOs surveyed say that search engine results are the primary way their customers find them online, a proportion that increases to 67% among respondents at top 100 retailers and is also significantly larger than the 30% who cited this channel in 2010. Email promotions (13%) and previous shopping experience (8%) are primary drivers to a far smaller proportion this year than last, falling from 24% and 30% of respondents respectively.

According to an e-tailing group survey released in November, paid search (30%) will see the greatest share of merchants’ holiday and 2012 online/cross-channel marketing budgets, followed by email (18%) and SEO / natural search (11%). Even with planned budget increases, social strategies are predicted to account for just 8% of these budgets.

Retailers Integrate Social Media

According to the BDO survey, although only 13% of CMOs say that social networking sites are the primary way their customers find them online, 82% have made social media a part of their marketing strategies this year, increasing from 75% in 2010, 51% in 2009, and just 4% in 2007. Social media marketing holds even more promise for respondents at the top 100 largest retailers, all of which say they make use of social media in their holiday marketing.

On average, retailers devote 16% of their marketing efforts to social networking sites, with more than one-quarter of respondents saying they will spend more than 20% of their efforts on these sites.

Facebook Gets Most Attention, Again

Not surprisingly, Facebook dominates CMOs’ marketing efforts: 94% say they are using the social networking giant for their holiday marketing this year, double the proportion who are making use of Twitter. LinkedIn (12%), YouTube (11%), and Foursquare/other location services (8%) are also relatively less popular marketing destinations among the CMOs surveyed.

Other Findings

  • Just 36% of CMOs say they have included mobile in their marketing strategy, down significantly from 58% in 2010. Of those incorporating mobile, 84% say it accounts for less than 10% of their holiday marketing efforts. These are surprising results, given that an October 2011 survey from the NRF found that 52.6% of smartphone owners said they will use their device to research products, redeem coupons, use apps to assist in their purchase, and purchase holiday gifts and items.
  • Only one-third of respondents say they make use of flash sales, including group and daily deals.

About the Data: The BDO USA survey examined the opinions of 100 chief marketing officers at leading retailers located throughout the country. The retailers in the study were among the largest in the country, including 12 percent of the top 100 based on annual sales revenue. The telephone survey was conducted in September and October of 2011.

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