A recent report from Borrell Associates, a professional US media trend forecaster, is indicating that there is a shift happening within marketing-related activities that has seen spending on it increasing to a level that is much larger that what is currently being spent on advertising.
A detailed report released by Borrell Associates on the 19th April this year has attempted to capture the total spending by businesses on ‘digital marketing services’ as opposed to advertising in the US. Their study goes on to predict that businesses will spend an estimated $613 billion in DMS in 2016, an amount many times larger than ad spending.
The Borrell report is principally focused on the spending habits of small US-based businesses, and reveals some surprising results. Here are the digital marketing support spending figures by category based on estimate and projection figures gathered between 2012 and 2016 in $billions :
Online Ad Production = $104.48 (17%)
Online Marketing Support = $74.55 (12.2%)
Online Public Relations = $57.28 (9.3%)
Online Consulting & Research = $54.82 (8.9%)
Web Presence = $322.08 (52.5%)
The digital marketing services listed here do include adverts but also includes spending on presence management, public relations, content creation, listings management, app development, reputation monitoring, email contact and more.
Analysing the results of their study, Borrell conclude that 87.5 percent of online marketing support – as listed in the figures above – are used for SEO-related spending. They predict that SEO spending for 2016 will total just above $65 billion, and estimate this growing to nearly $80 billion by 2020.
The predicted SEO figures are massive and may cause many people to be sceptical about the projections. However, if figures continue to grow at the same rate as have been shown since 2012, then much more money is being spent on marketing-related digital services than ever before, and the spending small businesses are making don’t involve huge layouts on ad creation advertising. Traditional advertising averages around $200 to $300+ billion in the US each year.
Looking at research conducted by other media sources over the past two years also shows a notable increase in SEO-related activities within businesses to improve their company awareness and raise their profile:
- 70% of B2B marketers are creating more content than they did one year ago. (Content Marketing Institute, 2015)
- According to 2015 State of Marketing, 38% of marketers plan to shift spend from traditional mass advertising to advertising on digital channels. (Salesforce, 2015)
- 91% of B2B marketers use content marketing. But just 36% say they are effective at it. (Flip Creator, 2014)
- 46% of respondents indicated that they plan to increase spend in Organic and Paid search in the coming 12 months. (Regalix, 2015)
- 58% of B2B marketers use search engine marketing, making it the paid method used most often to promote/distribute content (they also say it’s the most effective paid method). (Content Marketing Institute, 2015)
- Every month there are more than 10.3 billion Google searches, with 78% of U.S. internet users researching products and services online. (B2B Marketing, 2014)
- More than 58% of marketers who have been using social media for one year or longer improved search engine rankings. (Hubspot, 2014)
It is hard to argue with the Borrell Associates report when you can also see the trend shifting