Marketing spending hit $436.3 billion in 2021 — a 21.6% hike over 2020, according to Looking Back At 2021: US Economic Rebounds; Marketing Investment Accelerates, a study released Thursday by Winterberry Group.
That’s in contrast with the 4.8% decline from 2019 to 2020.
But the growth is more than a rebound — it grew at “a rate I've never seen in the 15 years I'm doing this,” says Bruce Biegel, senior managing partner of Winterberry Group, speaking during a virtual presentation.
And subject to macroeconomic trends and the COVID-19 pandemic, total spending should see a 11.8% hike in 2022, to $487 billion.
In 2021, the online spend hit $240.4 billion. The shift was due to an increase in digitally engaged customers. Email/SMS snared a 10.8% increase, for a total of $5.7 billion.
However, email was dwarfed by some of the other digital channels, including: paid social (up 33.3% to $58.6 billion) and display (up 15.8% to $41 billion).
Email/SMS should see a 7.1% hike to $6.1 billion. But again, paid social will see bigger numbers: A 15.1% hike to $67.4 billion. And digital video, regardless of the channel, will likely snare a 9.9% jump to $15.5 billion.
Meanwhile, spending on data technology reached $7.9 billion in 2021 — a 35.2% increase YOY. Spending in the email area jumped by 11.9% to $3.2 billion.
This trend is occurring as data and identifiers are being cut off by companies such as Apple.
But “onboarding is not going away — the way we do identity is going away,” Biegel says. “We are losing identifiers right and left.”
Expect this money to go into zero- and first-party data, and customer data platforms. Prospective CDP buyers are increasingly saying “give me an extra week on that proposal because we are sold out,” Biegel notes. (These trends are also reflected in a study released on Thursday by Braze).
As for privacy, Biegel predicts more data regulation that increasingly will resemble GDPR. But, “I don't see any meaningful federal privacy legislation coming down this year.” Rather, there will be a focus on regulating social platforms.
Meanwhile, offline channels registered a decline in 2021 — by 5.7% to $196 billion. But direct mail grew by 10.4% to $41.9 billion in 2021, in contrast to magazine ad spend ((-8.1% to $7.5 billion) and newspapers (-6.1% to $7 billion).“Direct mail has not seen a 10% growth rate since 2007-08,” Biegel says.
Moreover, the study projects that direct mail will grow by 3.5% to $8.5 billion in 2022 even as total offline spending declines by 2.5% to $196 billion. Experiential/sponsorship will increase by 16.8% to $42.2 billion, while addressable TV will grow by 27.4%.
Yet magazine spending will continue to plummet — by 17.2% to $6.2 billion, and newspapers by 9.1% to $6.3 billion. Still, "Linear TV, for all the news about its being dead, wasn't dead," Biegel adds.
In direct mail and the offline world, there is now a shift into acquisition of new customers.
"Ten years ago, when the economy was growing really well, retention might have been 55% and acquisition," Biegel continues. "Acquisition is now 80% of that supply chain--there is a need to reach new customers."