The Decline of Advertising and the Rise of Content Spending

Just read through a very interesting post from Brian Solis on Forrester's Five-Year Media Spending Forecast. From the results, this quote from Forrester's Shar VanBoskirk is worth some discussion:

"The most interesting takeaway from the research is that overall advertising budgets will decline.  Yep.  With dollars moving out of traditional media toward less expensive and more efficient interactive tools, marketers will actually need less money to accomplish their current advertising goals."

Takeaways here...

• Five years is a long time.  Twitter isn't even that old.  Take these with a grain of salt.
• Anyone who doesn't think that advertising budgets will decline should try a new career.
• Yes, online efforts are cheaper, and social media is essentially free...but what's not being said here is a lot.

Where's Content?

Let's look at a few of the biggest projected growth areas, social media and search marketing.

• I've said it before and I'll say it again, social media doesn't work without relevant, valuable and consistent content. Success in social media relies on a web content strategy that works for the brand and especially for the brand's advocates. Although social media distribution is essentially free (Twitter, posting on YouTube), the content planning, resource allocation and then creation is not. That's where the money is going.  Take Hubspot for example.  The distribution of their content is very cost effective (blog, online TV series, community site for example), but the planning time, knowledge, resources and coordination cost plenty.  Worth it...absolutely, but inexpensive...no. Content usually shows up in another line item on a budget, which may be the problem.  No one ever knows how much the content really costs. I know some executives that think that the content magically appears every week at the end of a rainbow.
• Then comes search marketing. Showing up in search results means you need great content. Getting results from pay-per-click usually means you need a great content offer. Either way, without content, search doesn't work.

What I've just pointed out may seem obvious to some, but I see this over and over again first hand. Small, medium and even large companies look to "alternative" online strategies and discount the cost of the content.

Actual client: "I want to create an ongoing content series, most likely a blog, that we can integrate into a social media campaign. We need a content plan and need to outsource the editorial.  Also looking for integration into social media (Twitter and other stuff like that) and monitoring of our objectives (more traffic) . Budget is about $5k." Yikes! (This example is from a $500 million dollar company)

Spend on the Right Content Initiatives

Okay, so what should you do with this?  First off, stop thinking about content marketing or content strategy as the end deliverable. The content process is not just the video series, the enewsletter or the custom magazine. It's the entire content strategy process, including (shout out to Kristina Halvorson from Brain Traffic on guidance here):

• The Content Audit. Before you usher in more content noise, it's worth it to figure out what you have said. Anyone about to spend significant investment in content creation should develop a content benchmark first.
• The Content Plan. Who's the audience?; What are their informational needs?; What are the success metrics of the content plan?; Who owns the plan?; What are the best content tactics?; How will we execute those tactics?;
• Content Maintenance.  Once we create the content, how do we keep it fresh, updated, and continually monitor our customers' informational needs so that we succeed with the content plan?
• Content Marketing. How are we distributing our valuable, relevant content so that we deliver on our success metrics?

So, the morale of the story is, take all that money you are saving by not advertising, and make sure you put it into the right content buckets. Yes, social media may be free, but succeeding in social media and your web content strategy is not.

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Comments

[Jonathan Kranz]

Right on, Joe! The truth is, content marketing ain't free. (The $500 million company that wants to spend just $5,000 on a complete campaign? Oy vey! Yet they wouldn't blink to spend that on one, lame print ad...)

But it's not just an investment in dough. It's an investment in THOUGHT. And there's the real rub. It's so much easier to throw money at an ad or commercial. It's so much more difficult to stop and THINK about what your audience wants, what you know, and how to connect the two.

[Joe Pulizzi]

Amen brother! You hit the nail on the head. Marketing today is not easy. But it's a lot more interesting.

[Stephanie Tilton]

Great post Joe! It still amazes me when I hear B2B companies balk at making an investment in sharing their ideas and thoughts. In fact, they can get a lot of bang for their buck in today's social media world - there are now so many ways to spread a single idea. But even after developing a solid plan such as the one you (and Kristina) have outlined, marketers may still struggle to measure the success of their content plan. That's because social media largely revolves around engaging prospects in a "conversation." That said, @BlakeHinckley has just put up an interesting post about "passive profiling" as an non-intrusive way to track engagement with content. (http://marketinglab.bnj.com/2009/07/learning-b2b-from-the-cia-passive-profiling/) I think marketers are going to need and want this type of measurement going forward.

[Morgan]

Great post Joe. I agree completely. All companies will become publishers (if they're not already) and whether they outsource it or invest in it in-house they need to think like a publisher and understand how publishing content ties to bottom line and strategic goals.

You can't just start a blog or a podcast or a series of white papers and not have a coherent plan of where you're going, what you're looking to achieve and how you're going to make it all happen.

As brands become publishers they'll need to add to the budget content creators, editors and other traditional publishing roles. And those are real costs, whether outsourced or not.

[Joe Pulizzi]

@ Stephanie...thanks for the link...I'll check it out.

@ Morgan. Absolutely. The rise of the corporate content strategist is at hand (the brand publisher).

[John DiPaola]

Actually, social media and blogs rank very low on the food chain when it comes to the real world process of building brand and selling products and services in the industrial b2b world. Still a big part of our GDP.

That is the world we live in today. Who knows about tomorrow.

We would all be better off actually getting in front of the customer, selling value and building relationships.

New media and traditional advertising paves the way as long as it is connected with unique and relevant content. Always did and always will.

[ContentKeith]

While some marketers and many of us are early adopters of 'content marketing,' I wonder how long it might take to be mentioned in the second breath behind search, email, etc., let alone in the same breath.

Joe, my favorite quote of yours has to be "social media doesn't work without relevant, valuable and consistent content." Even social media seems to be on more understood (and therefore more solid) footing than content marketing.

Guess it's up to the stalwart evangelists like you to spread the gospel...count me in as an apostle! Keep it comin'!

[Steve Harlow]

I'm right in there with ContentKeith. An early adopter of "content marketing". So many people who "claim" to be marketing through Social Media, just do not get it.

Too many out there just have the easy street mentality that all it takes is to set up automated posts, and continually blast ads 24/7. They do this because they think that this is "free" advertising.

It is actually useless garbage. Folks have been blasted with these SPAM tactics for so long, they have developed SPAM filters in their own head. They simply filter this junk out.

What catches their attention is the true content. Relevant, useful information. Ideas and real tools that can help them solve their own needs.

So you spend your time developing this content, share it, see the results, and then you need to set back, and measure those results against the time that you put into it. That is when you can put a dollar figure to it, and see what your true "free" advertising costs are.

Keep up the great work Joe.

[Mason]

To be honest, the best strategy and path to get your ad on the right track is to sent it to a site that will post it and get it out immediately. try this site i use for my ads, http://adwido.com . they are the best ive ran into!

[Joe Pulizzi]

Great conversation guys.

@John...you are right...70% of all dollars still go into very traditional advertising and media...but that is on a decline. Who knows where it will be in 5 years. I'd say less than 50%, which is a ton of money. That money will need to move into more content and relationship-oriented vehicles.

@Keith/Steve...content marketing is more difficult, takes more time, but has a greater payoff in the long run. I think people are starting to get it, and social media is helping.

At some point, all this will just be known as plain old marketing. Should be a fun ride.

[Elizabeth]

Amen. Content is still king. It takes a lot of thought and effort on a continuous basis--and that takes money. Companies need to be willing to invest in creating better content because that's what's going to impact the bottom line in the future.

[Online Sales Manager]

Another great post Joe. I actually just bought your book - "Get Content. Get Customers". Thoroughly enjoyed it. Very practical - particularly the Best Practice Success Stories. I think that is essential reading for anyone who wants to sell products or services online.

[Joe Pulizzi]

Thanks for the Kudos OSM! Appreciate you spreading the word.

[Emily Render]

Thanks for this post. Writing, content creation, communications... The work I do for businesses and non-profits goes by many names. Lately I've noticed some commentary, predictions and market research on trends in this field, including the one you mention here. [posted on http://emilyrender.wordpress.com]

1. I read that the majority of businesses (nearly 60%) are increasing budgets for content creation despite the economy, according to a Junta42 study - but where is this study on your website? Would have liked to link back to it.

2. "In 2008, total communications spending actually increased 2.3 percent, to $882.6 billion, but that was the sector’s slowest growth rate since 2001. Advertising, as is clear by now, is contracting. Spending dropped 2.9 percent in 2008, to $210 billion," according to The New York Times. They also reported a prediction that the media industry will be the third fastest growing industry and much of that growth will come from public relations and the internet, not from newspapers and traditional media.

3. "Good writing, thoughtful writing, and the effective presentation of ideas will be necessary however it is delivered. Those who can effectively analyze, disseminate and distribute information will succeed. Those who can adapt and prepare for change while staying true to a certain inner strength, a certain confidence in the effectiveness of what their doing, will have the best prospects." - Bill Lascher

[Joe Pulizzi]

Love your thinking on this Emily.

BTW, here is the link to the research article on content spending you were looking for

http://www.junta42.com/resources/content-marketing-spending.aspx

[Scott Paley]

I suspect it's less about the money and more about the effort involved. If you're a CMO of a big company, it's MUCH easier to buy a bunch of ads and purchase media than it is to develop a compelling and effective content strategy. Marketers aren't wired this way (today).

The consistent development of great content is really, really hard to do!

Largely, it's going to take an educational effort before content marketing becomes mainstream. However, I strongly believe it's on its way.

[Joe Pulizzi]

Scott...Amen to that. I completely agree. Content marketing is very difficult to do - especially with marketers who have well-worn media paths. It takes a different kind of thinking - but I agree - it's on the way.