Organic Growth Drives Media Market
The economy is still a big question mark, but media industry professionals are thinking good thoughts -- especially about the near term.
Over the next year to two years, 82% of media industry executives say "organic growth" will be the big driver of their businesses.
The survey from media broker The Jordan Edmiston Group Inc. says "from the smallest digital start-ups to the largest global corporations, companies are planning to launch new products and services, make acquisitions, expand market share, and enter new markets and geographic regions."
It adds that nearly half of all executives say their companies are expected to make an acquisition in the next 12 to 24 months. Looking at the biggest companies -- those with $250 million in revenue -- 81% of those executives expect to make an acquisition in that time. Only 27% expect "divestiture" or sales of company units or business -- another positive sign.
Seventy percent of these media executives expect increased market share within existing markets over the next two years, with 68% anticipating this in three to five years.
What regions? Forty-nine percent of executives believe it will come in North America, with 31% saying the growth will come from China. Nine percent say it will be Europe and 7% say South America.
Online advertising continues to be a major component. Internet advertising -- it notes -- grew 17% in 2010 to $6.4 billion. The total is expected to rise another 10% this year, with prospects of a $40 billion industry by 2014.
The biggest challenge to growth is those companies that offer free or low-cost alternatives to products and services. Larger companies worry about being nimble enough to provide more access to products/services online and other digital platforms.