• by Gavin O'Malley  @mp_gavin, November 11, 2009

While the interactive marketing industry is poised to grow at a 16% compound annual growth rate through 2014, don't expect all sectors to match that pace, according to a new report from Forrester Research.

Overall, interactive marketing will near $55 billion by 2014, but some industries -- like consumer goods, automotive, and media and entertainment -- will grow interactive investment faster than others.

Retail and financial services will own the largest share of all interactive marketing, while brand advertisers in industries like consumer goods show the greatest potential for growth. Forrester, meanwhile, estimates that travel firms have the largest per-company interactive budgets.

"While it's helpful to understand industry spending dynamics, we recommend benchmarking your own spend against companies that are like yours -- even if they are outside of your industry group," said Shar VanBoskirk, Forrester Research principal analyst and lead author of the report.

To pace interactive marketing spend by industry, Forrester sized search marketing, display advertising, email marketing, social media, and mobile marketing by 11 business verticals.

Retail and financial services spend the most, Forrester reports. "Today, companies in these verticals account for 33% of all interactive spend -- downshifting only slightly to 32% by 2014."

Three primary factors were found to be responsible for this trend: the adoption of interactive marketing among retail and financial firms is high; interactive tools are particularly good at driving immediate online transactions -- a priority for retail and financial servicesm -- and after the collapse of many financial firms in late 2008, remaining ones are spending on both traditional and interactive media to reassure consumers of their stability.

In addition, big offline advertisers will grow the most online. Big brand advertisers -- like media and entertainment, consumer goods, automotive, and health care firms -- spend less online today than direct marketers, according to Forrester. However, they also have the highest growth potential.

Consumer goods' interactive spend over the next five years will grow at a 22% compound annual growth rate, while automotive and media and entertainment will pace at a 19% and health and pharmaceuticals at an 18% CAGR.

Increased spend will come as branding formats like online video evolve, as attribution platforms make it easier to tie online ads to in-store purchases, and as regulated industries -- like health care -- gain online experience.

Early social media trials for NEXIUM, Prilosec OTC, and AMBIEN CR have exceeded AstraZeneca Pharmaceuticals', Procter & Gamble's, and sanofi-aventis' expectations, respectively, paving the way for more investment B2B interactive investment will remain strong.

This year's forecast includes a B2B category that consists of business services -- like accounting firms, consultancies, and agencies, as well as the business trade elements of all other industries, like marketing between a manufacturer and resellers. This category will stay at about 9% of the overall interactive pie over the next five years, growing from $2.3 billion today to $4.8 billion in 2014 as B2B marketers adopt emerging media and improve the sophistication of existing efforts.

Education, local services, and government make up the growth category "other." The collection of all other businesses -- dominated by online universities, home improvement services like cabinet installation or lawn care, and local and national government -- will grow more than 20% between now and 2014.

This steep growth will come as local advertising options improve and government agencies promote newly online processes -- like car registration renewals -- and competition for students heats up in the increasingly popular online education space.

One example in this category, the University of Phoenix, has its own online ad network and offers online promotions and coupons to foster course registrations.

Today, direct marketers, like travel firms, tend to have the largest corporate interactive budgets. "This is because they have the longest tenure with online channels, a history using customer insights to target messages in the offline world, and the ability to see immediate online sales generated from interactive efforts," according to Forrester.

Consumer goods, media and entertainment, and high-tech and manufacturing firms spend much less on interactive as a percentage of their overall marketing budgets because these industries are so heavily invested in traditional branding media like TV.