Ad Exec Confidence In Digital Media Wanes For First Time -- Ever

by Joe Mandese , September 19, 2013

For the first time in the six years since an independent researcher began tracking “advertiser confidence” to spend their future budgets on major media, ad execs signaled a note of pessimism toward digital media. The finding, which comes from the just-released Advertiser Optimism Report from Advertiser Perceptions Inc., is interesting, because the overall sentiment for spending across all media remains at the periodic study’s all-time high.

While the confidence of ad execs to invest in digital media over the next 12 months remains high overall, the fact that it is beginning to wane -- at all -- is “being driven primarily by marketers who indicate that they will be spending less with digital publishers and portals,” says Ken Pearl, a partner and co-founder of API.

The second “surprise” in the new report, which is based on a recent survey of adverisers and agency executives, he says, “is that marketers are bullish when it comes to spending on traditional media -- namely broadcast television, magazines and national newspapers.”

As has been detected by API in the past, there is some divergence between marketers and their agency counterparts when it comes to their spending plans for major media.

“Agencies are in agreement in their optimism for national newspapers, however remain more pessimistic about broadcast and magazine ad spending than their clients,” Pearl notes, adding that overall, all ad execs remain extremely buoyant in their plans to invest in mobile media.

Using an index based on the percentage point difference between those ad execs planning to either increase or decrease their ad budgets over the next 12 months overall, and by specific media, the overall Ad Confidence Index remains at a 16, the same number reported in API’s last report last fall, and the highest since 2007. The lowest point was a -5 in the spring of 2009, following the global economic crisis. The index for overall digital media remains near its high -- a 46 -- and second only to mobile (a 61), despite eroding slightly.

11 comments about "Ad Exec Confidence In Digital Media Wanes For First Time -- Ever".

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Tom Cunniff from Tom Cunniff, September 19, 2013 at 12:44 p.m.
I think this is actually a *great* thing. The initial euphoria over digital led to a lot of unrealistic expectations. There was a naive tendency to throw money at tactics ("bright shiny object syndrome") without pausing to consider strategy. Now is the perfect time for brand marketers to re-assess efforts and seek a smarter, more integrated, more strategic approach. A mature understanding is better than naive confidence any day.
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philip gentile from Consultant, September 19, 2013 at 12:45 p.m.

Edit job needed here: ...ad execs INDICATED SIGNALED a note of pessimism toward digital media...

Mike Einstein from the Brothers Einstein, September 19, 2013 at 1:01 p.m.

Two quotes come to mind, both more than 50 years old, that support this lack of confidence. The first from Bill Bernbach: “Advertising is fundamentally persuasion and persuasion happens to be not a science, but an art.” And the second from Albert Einstein: "I fear the day that technology will surpass our human interaction. The world will have a generation of idiots."

Tom Cunniff from Tom Cunniff, September 19, 2013 at 1:28 p.m.

Mike, I think we're at Gartner's classic "trough of disillusionment" phase. I was there about three years ago, but now see more reasons to be optimistic. The biggest challenge is to use the tools we have properly. I used the exact same Einstein quote in my latest blog post. http://tomcunniff.com/2013/08/get-analytics-insight/

Mike Einstein from the Brothers Einstein, September 19, 2013 at 2:15 p.m.

Hi Tom, Went to your blog post and spent some time in the Data Crack Den. It's an interesting analogy to our media addiction, which, if Google, Apple et al have their way will make crack cocaine look like candy by comparison. I fully expect lots of push back from this comment, which will only prove why denial is the classic first response of the truly addicted. I wish I shared your optimism.

Todd Parsons from Criteo S.A., September 19, 2013 at 2:43 p.m.

Tom, I strongly agree that shaping an integrated strategy is smart, and would say it's a requirement of winning advertisers today. But let's not ignore the fact that a good strategy is evidenced through measurable tactics. I'm clearly biased as a digital guy, but don't think anything has changed to help me quantify newspaper or mags as more effective mediums than a digital. I'm not disillusioned by digital because I can measure, improve result through learning and inform my integrated strategy. But it bugs me that I can't do that elsewhere. Hence, this survey says the pendulum is swinging back with little logic behind it.

Tom Cunniff from Tom Cunniff, September 19, 2013 at 2:53 p.m.

Todd, I think part of brand marketers' disillusionment comes from the realization that the things we can measure are not always the things that matter. Blowing the doors off our KPIs only matters if we have the right KPIs. Disillusionment with digital is not a bad thing. It's a necessary (and logical) step along the path to learning what really works.

Robert Rosenthal from Rosenthal Heavy Industries, September 19, 2013 at 6:04 p.m.

Supposed advertiser "confidence" is a less meaningful indicator of future purchase than is the movement of consumer eyeballs. Overall magazine circulation, for example, dropped annually from 2008-2011. In contrast, media consumption on tablets and smartphones has increased.
Don't you think the smart ad money will follow the eyeballs?

Fraser E from Opinions expressed herein are solely my own, September 19, 2013 at 7:46 p.m.

It's about time! We've been spending so much time and effort measuring how many blades of grass show up in our mulch bag that we've completely ignoring the health of the lawn overall, and forgotten that we can measure that too. We spend all our time an effort on the bright shiny object of lead-gen and completely ignore demand generation. When I hear "I can't measure newspaper or magazines" I have to stifle a facepalm. When I hear, as I often do, that "traditional media always relied on branding theory and never any measurement" I get downright cranky. Yes. You can measure those things, if you choose to set up the measurement to suit the medium and the way in which the medium is actually used in the campaign. Demand-gen (aka the evil word "branding") isn't all about site visits.

Tim Mally from Hivewyre, September 19, 2013 at 8:30 p.m.

I found the information in the article as well as the comments enlightening. All the talk of "confidence" and advertisers moving their favor to offline channels makes me wonder if something fundamentally changed to cause this. I remember a notable Adweek article from early summer highlighting a high volume exceptionally suspect online traffic providers and click fraud costing advertisers 100's of millions of dollars. Is it possible that wide ranging fraud has caused advertisers to become more cautious? Food for thought.

Mark Mclaughlin from McLaughlin Strategy, September 20, 2013 at 12:36 p.m.

When do we stop doing surveys about "digital media" as if SEM and video pre-rolls can all be lumped together?