"Status quo. Everyone is looking for ROI and proven effectiveness," readers the verbatim response of one buyer in the Deutsche Bank report. "Recovering slowly. There is more confidence in advertising as an investment that produces a positive ROI," reads another.
One buyer even described the current advertising climate as "schizophrenic," noting that initial expectations coming into 2011 haven't "held up," and that much of the optimism heading into 2012 is due to "artificially inflated" factors such as incremental spending due to the 2012 Summer Olympic Games in London and the U.S. elections.
Overall, the Deutsche Bank survey reflects the trends shown in the big agency outlooks, with greater optimism for national media - especially TV and digital - and a more tepid view for local media, particularly radio and newspapers. National magazines are also under pressure as marketers and agencies put increased emphasis on media that can demonstrate an immediate ROI - or return on investment.
Not surprisingly, digital media -- especially online search, display, video, mobile and social media - have stronger expectations among the media buyers surveyed.
"If the ad market hits a soft patch, this trend will likely become more apparent as buyers will likely increase their investment in higher ROI media, at the expense of print and radio," the securities analysts wrote in their report, which projects that online media will continue to lead U.S. advertising growth for the foreseeable future.
"We remain bullish on the fundamentals of Internet media, and continue to believe that ad dollars will follow consumers as they migrate to new platforms, resulting in another year of robust growth in 2011 once again," the analysts wrote, noting that much of digital media's gains will be coming from ad budget share gains from print media, and adding that a "strong e-commerce market continues to drive investment in online advertising."
The consensus of the media buyers surveyed is that "online/digital" ad budgets will rise 7.0% in the U.S. in 2011, a more modest view than Deutsche Bank's own prediction of 18% growth for digital media spending this year, but still the healthiest of the major media, according to the buyers. TV (+5.1%) and outdoor (+2.5%) are the only other major media expected to reap gains, yielding an overall gain of 3.2% among the major U.S. media for 2011. That is in line with recent outlook revisions issued by Interpublic, WPP, Publicis and Aegis.
While online and digital media remain the catalysts for overall growth, a recent survey of advertisers and media buyers released by Advertiser Perceptions Inc. indicates the relative optimism of digital media may be losing some steam too. While API's Spring 2011 Advertiser Optimism report the highest level of optimism - the difference between those indicating plans to increase or decrease advertising budgets - since the global economic crisis hit, the relative contribution of digital media appears to be ebbing, though it remains considerably higher than analogue media.
The digital media average dropped 11 optimism points from API's Fall 2010 survey to a 48, and mobile fell five points to a 61.
Between search and display, API found slightly greater erosion in the optimism for display ad spending, which eroded 13 points to a 46, while search declined 11 points to a 47.
Even the vaunted social media category, as reflected by advertiser optimism to spend on Facebook, has declined on a relative basis, dropping 12 points to a 58 from last Fall to this Spring.
On a positive note, elements of the online display marketplace - especially ad networks/exchanges (+6 points to 26), demand-side platforms (+4 points to 16), and portals (+6 points to 11) - are showing gains in optimism. Though agency trading desks, low to begin with, have dropped two points to an optimism index of only two points.