Barriers Between Traditional And Interactive Marketing Will
Dissolve Within Five Years
CHICAGO--(BUSINESS WIRE)--Oct. 11, 2007--Interactive marketing
spending in the US will more than triple over the next five years,
reaching $61 billion by 2012, according to a new Forrester Research,
Inc. (Nasdaq: FORR) report released today at the Forrester Consumer
Forum 2007 in Chicago. Forrester expects that a maturing perspective
about interactive channels coupled with technology advances will
eventually lead to interactive technologies infusing all marketing
efforts, and the interactive marketing organization will dissolve.
"As firms continue to make customer centricity a higher priority,
they will recognize that maintaining separate marketing teams to
manage different sets of channels that all target the same customers
makes no sense," said Forrester Research Principal Analyst Shar
VanBoskirk. "Over the next five years, we see interactive technologies
gradually infiltrating all media -- including such traditional
paragons as television, billboards, and direct mail -- and the concept
of a separate interactive marketing organization will disappear."
The growth in interactive marketing spending represents a 27
percent compound annual growth rate (CAGR) over the next five years.
Interactive marketing -- which currently comprises 8 percent of all ad
spending -- will grow to 18 percent of total ad budgets in five years.
The Forrester forecast is based in part on a survey of 344
interactive marketing professionals and their budget decisions
affecting display ads, search, email marketing, online video, and
emerging media (social, mobile, and advergaming). Forrester's
breakdown of spending includes the following:
-- Search marketing will triple in five years. Mainstream
marketers' aggressive use of search marketing will grow the
category at a CAGR of 26 percent to $25 billion by 2012 due to
the increasing costs of paid search, additional spending on
optimization tools and services, and international expansion.
-- Display advertising will reach $14 billion by 2012. Display
ads will be a key factor in the interactive marketing budget
by having an essential supporting role for all interactive
-- Services and integration -- not volume -- will drive email
marketing growth. Spending will focus on improving email
relevancy with analytics and data management, and will grow to
more than $4 billion by 2012.
-- Online video ads will significantly increase. Growing consumer
adoption of online video will result in a dramatic 72 percent
increase in online video ad spending to $7.1 billion by 2012.
More customer-centric online video applications will increase
the medium's appeal for consumers and marketers.
-- Social media will drive emerging channels to $10 billion by
2012. Mainstream adoption will boost spending in emerging
channels such as social media, mobile, game marketing,
widgets, podcasts, and RSS. Spending on social media alone
will grow to $6.9 billion as marketers understand how to use
and measure this channel.
-- Mobile marketing will grow to $2.8 billion. As consumers
become increasingly tied to personal computing handsets,
they'll want to extend their mobile utility to accommodate
transactions. This transition will drive mobile marketing to
grow to $2.8 billion by 2012.
"These changes will not only affect the budget structure of
marketing organizations, but it will also give interactive marketing
professionals a more legitimate seat at the marketing table,"
VanBoskirk continues. "In fact, with interactive marketing gaining
executive visibility as much for its popularity with young consumers
as for its measurability and cost effectiveness, we see a class of
marketers emerging who will involve themselves with a few high-profile
interactive experiments in order to catapult themselves into the CMO
"US Interactive Marketing Forecast, 2007 To 2012" is currently
available to Forrester RoleView clients and can also be purchased
directly at http://www.forrester.com/go?docid=42463
About Forrester Research
Forrester Research, Inc. (Nasdaq: FORR) is an independent
technology and market research company that provides pragmatic and
forward-thinking advice to global leaders in business and technology.
For more than 24 years, Forrester has been making leaders successful
every day through its proprietary research, consulting, events, and
peer-to-peer executive programs. For more information, visit
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SOURCE: Forrester Research, Inc.