Interactive Budgets Are on the Rise as Traditional Advertising Declines

Before you consider investing in another radio campaign or newspaper ad, consider the following forecast that Forrester Research recently released on interactive marketing expenditures.

They predict that interactive marketing channels such as search marketing, social media, and mobile advertising will increase from 12% of organizations total marketing expenditures in 2009 to 21% in 2014.

Search engine marketing expenditures are anticipated to increase by 205% in the next five years and will continue to capture the largest portion of interactive budgets. Social media expenditures are expected to increase by 434% as marketers incorporate social media marketing into their overall Web strategies.

According to Forrester’s Shar VanBoskirk the most valuable nugget of the research involves the decline of traditional advertising dollars.

“But to me, 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.   But reasonable marketers won’t relinquish budget because their programs are running too efficiently. Instead, marketers will allocate unused advertising dollars into investments like innovation, research, customer service, customer experiences, and marketing-specific technology and IT staff, in order to further marketing’s strategic influence within their companies. “

The continued shift away from traditional media forms is a result of an ever-increasing amount of consumers going online for information. Couple this with the logistical fact that interactive advertising is more easily measured and able to demonstrate ROI, and you can see why marketers are consistently turning to the Web to reach their audience.