The Decline of Traditional Advertising

and the Rise of Social Media

• July 8, 2009

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Forrester Research released its five year forecast that estimates interactive marketing
spending from 2009 – 2014. Forrester predicts that interactive marketing in the US will near
$55 billion and represent 21% of all marketing spend by 2014 and will include search
marketing, display advertising, email marketing, social media, and mobile marketing.
More significantly however, overall advertising in traditional media will continue to decline in
favor of less expensive, more effective interactive tools and services.
Forrester analyst Shar VanBoskirk alerts marketing and media professionals with a dire
warning, “The cannibalization of traditional media will bring about a decline in overall
advertising budgets, death to obsolete agencies, a publisher awakening, and a new identity
for Yahoo!”
The majority of budget appears to be earmarked for search marketing, even though the
search landscape is rapidly evolving to include real-time updates and also social, community
and micro networks. As a marketing professional seeking to tap into spending and visibility
trends, take notice to activity in Mobile and Social Media over the next five years.
As mobile devices not only extend the collaboration and productivity capabilities that used to
tether us to fixed locations, we’re also seeing the rise of new, highly interactive mobile
platforms and networks that increasingly capture our attention and time. Spending growth
over the next five years is compounded at 27% which makes it the second most notable
growth factor behind Social Media with $1,274 (in millions) expected to fund mobile
programs in 2014.
Social Media spending will increase to $3,113 (in millions) in 2014 from $716 in 2009
representing a compound annual growth rate of 34% – the highest percentage gain in the
marketing mix. This spending activity also ranks it it as the third most prominent program
behind search marketing and display advertising.
Dollars that are moving away from traditional advertising are now allocated towards “un”
marketing activities that will earn stature, credibility and ultimately empower a more confident
group of influential advocates through investments in innovation, research, customer
services, customer experiences, and marketing-specific technology and IT staff.
Trends in Advertising - Considerations for Small Business
There is structural change going on in the world of advertising, in part it is being accelerated
by the global downturn.

The structural changes relate to the decline of traditional advertising stalwarts, the yellow
pages, print media and television advertising.
Proof of the Problem - FirstlyYellow Pages
Increasing research in the US and Australia has found that the use of the traditional yellow
pages is declining.

People are increasingly turning to the Internet to find information, even local information.
Some figures suggest that this the use of on-line search can be as high as 80% of all
information searches.

Even Wall Street acknowledges that the days of printed directories like Yellow pages are
numbered. The Wall Street Journal reported that advertising in US print directories is
expected to fall 39% over the next four years. In there words as people migrate enmasse to
the web.
Dr Lynella Grant is the author of Yellow Page Smarts, she makes the point that relying on
just yellow pages is now longer safe: She makes the points that over half of all customers
now go to the internet first to find information even for local products.

Secondly the Print Media

The print media has long been the main source of news, and hence advertising. However,
good journalism, even bad comes at a price. The print media's classified and advertising
revenues have long funded their journalists and distribution costs. But that is no longer the
case.

Internet news is cutting deep in to the traditional print media. Many companies have tried to
build business models that are Internet friendly? Albeit that they are extensions of the old
business models, such as subscription services. Such models have generally failed, for a
variety of reasons, but one in particular dominates all. There is a perception amongst
Internet users that information on the net is free or should be free. With so many other
sources of information to choose from, browsers simply err away from subscription services
to other free sources of information.

Journalists are having debates over the fact if you want good information you need to pay for
it. That may be true, but at this stage of the Internets maturity, people appear to be less
discerning in the quality of information they receive.

The Canadian Company Dialect has published a list of newspapers around the world that
have been closed down,

Television Advertising
I read recently, unfortunately I can not remember the source, that over half the world's
television advertising spend is in the USA. Audience fragmentation is a main issue, people
have choice now in their visual home entertainment, from free to air television, cable tv,
Internet programs, even video games and dvd's etc. This choice range acts to fragment the
audience, and even the audience with in a household. Consider the old images from the
1950's and 60's probably even the 70's of families all sitting around one TV watching the hit
shows of the day. Now days, it is more likely that mom is watching on one TV, Dad on
another, the kids in their rooms either on MSN messenger or playing video games.

Here are some statistics, in the UK there forecasts indicate that advertising revenue is
expected to fall by nearly $0.7 Bn US in three years. The USA television bureau is
forecasting another 7% decline in advertising accross the sector.

So what is going up
Well not surprising internet advertising is growing at around 10% per annum. Again this is
not surprising either when you go back to fundamentals. The media companies whether TV
or print provide information and entertainment. But so does the internet!

The yellow pages provided information that was traditional inaccessible - a list of all service
providers in a category. But again so does the Internet, but it does so with the user being
able to source information of their choice.

So what to do
Firstly, your advertising mix still needs to contain elements of each of the media services.
Obviously depending on your target market and budget. Most companies are well versed
and educated in advertising through these traditional forms, so there is not much point
discussing them further.

Although it is worth mentioning that for small business it may be worth looking at TV
advertising as the costs may be more palatable now, relative to the results.

What we would contend is that companies need to have a well considered and balanced
marketing mix. A critical element of which is now Social Media Marketing.

Old media vs. New media, and the future of American

journalism
By Jon Stokes | Last updated April 30, 2005 11:26 PM

If you follow US politics and opinion journalism even peripherally, then you know that the one thing that
the entire political spectrum—right, center, and left—can agree on is that the American news media is
in trouble. Of course, pundits from different ends of the spectrum disagree on their diagnoses of the
problem and on their prescriptions for a cure. If you listen to the left, the success of Fox News, talk
radio, and Sinclair Broadcasting has not only polluted the waters of political discourse, but it has also
motivated less openly partisan news outlets like CNN and Time to move to the right in search of an
audience. The right, for its part, never misses an opportunity to decry the bias of the so-called "MSM,"
an acronym that used to mean one thing in HIV/AIDS public health circles but has now come to mean
"mainstream media."

Perhaps the best example of the total contempt that both sides have for the old-line news media is the
constant stream of vitriol aimed at the New York Times. The "Gray Lady" daily comes under fire from
the right for being a bastion of Northeastern liberalism, a characterization that the paper's public
editor claims is dead-on accurate. And from the left, the paper gets routinely blasted for everything
from shoddy reporting to periodically kow-towing to the GOP in that weak, ham-handed, and totally
transparent way that self-conscious lefties do when they're trying to come off as "fair and balanced."

Where there's smoke, there's fire, and I'm inclined to believe that both sides in the debate are on to
something, or even on to multiple somethings, but it's tough to sort out exactly what in the currently
polarized environment. Still, there are encouraging signs. The deep structural problems that afflict the
news media are now starting to get serious attention from the press itself. Right now, it is becoming
fashionable for establishment types to talk openly of the press's problems, and this talk most often
occurs in the context of discussions of blogging and online journalism as the wave of the future or
somesuch. Consider Rupert Murdoch's recent remarks as reported in this excellent article (also check
out the TD post on it) in the Economist:

"I BELIEVE too many of us editors and reporters are out of touch with our readers," Rupert Murdoch,
the boss of News Corporation, one of the world's largest media companies, told the American Society
of Newspaper Editors last week. No wonder that people, and in particular the young, are ditching their
newspapers. Today's teens, twenty- and thirty-somethings "don't want to rely on a god-like figure from
above to tell them what's important," Mr Murdoch said, "and they certainly don't want news presented
as gospel." And yet, he went on, "as an industry, many of us have been remarkably, unaccountably,
complacent."

The Economist article goes on to give the remarkable statistic that 44% of Americans aged 18 to 29
read blogs regularly, and it discusses in a fairly sober and even-handed fashion the role of blogs in
America's current media ecology. Overall, the picture that emerges has two sides to it. First, top-tier
bloggers themselves are better educated than top-tier newspaper columnists. So one of the main
attractions of blogging and other forms of online-only publishing is that you get topical commentary
from trained specialists and insiders, instead of from people whose only professional training is
journalism school and whose very job description is that they're professional outsiders.

The other part of the picture is the audience, which is more media savvy and is more interested in
being treated as a peer by news sources. Blogs and other online news sources treat their readers as
peers by allowing them to post comments that are directly attached to stories and by adopting a more
personal, conversational tone. Thus the audience can participate directly in the newsmaking process,
as high-profile blogs manage the collective efforts of their readers and work to influence reporting
higher up the media food chain.

The issue of tone brings us back the Murdoch quote above, which some might be inclined to ridicule
but which I think hits the nail on the head. As evidence that Murdoch is on to something, consider the
quote below fromthis excellent essay by Paul Graham that has been making its way around online.
Graham takes a NYT article on the alleged recent return of the suit to the corporate boardroom and
shows how it's the result not of diligent reporting but of a carefully planted "hit" from a PR firm that's
probably working for Men's Wearhouse. Furthermore, if an unsuspecting reader were to go by the
evidence of a number of remarkably similar stories printed in a range of press outlets, from USA Today
to CNN, suits appear to have made a "comeback" in corporate America multiple times a year for the
past three years. All of these news stories are in fact part of a carefully staged PR campaign, in which
lazy journalists who're looking for a story to submit on deadline are fed facts, figures, quotes, and
entire stories by PR reps whose job it is to create "buzz" and publicity for a client. Now, here's that
quote from the article:

Most people who publish online write what they write for the simple reason that they want to. You can't
see the fingerprints of PR firms all over the articles, as you can in so many print publications—which is
one of the reasons, though they may not consciously realize it, that readers trust bloggers more than
Business Week.

I was talking recently to a friend who works for a big newspaper. He thought the print media were in
serious trouble, and that they were still mostly in denial about it. "They think the decline is cyclic," he
said. "Actually it's structural."

In other words, the readers are leaving, and they're not coming back.

Why? I think the main reason is that the writing online is more honest. Imagine how incongruous the
New York Times article about suits would sound if you read it in a blog:

The urge to look corporate—sleek, commanding, prudent, yet with just a touch of hubris on your well-
cut sleeve—is an unexpected development in a time of business disgrace.

The problem with this article is not just that it originated in a PR firm. The whole tone is bogus. This is
the tone of someone writing down to their audience.

Whatever its flaws, the writing you find online is authentic. It's not mystery meat cooked up out of
scraps of pitch letters and press releases, and pressed into molds of zippy journalese. It's people
writing what they think.

I think both Graham and Murdoch have correctly identified an important factor in both the success of
online journalism and in the slow-motion train wreck of a failed institution that is the traditional press.
People just don't trust reporters enough anymore to consent to being talked down to by them, and
Graham's article shows that the public has good reason to distrust the press. Furthermore, when tech
firms are paying journalists to promote products on TV news shows, and when the US government is
playing the same game, is it any wonder that unhappiness with the press is incredibly widespread?
Whatever narratives that future historians eventually spin about the decline and fall of the American
journalism, it will have to include a breach of trust on the part of the fourth estate and a much-deserved
crisis of confidence on the part of the public.
Many of the prescriptions for curing what ails journalism put forward by both the left and the right
involve the Internet, but online journalism has its own problems. In particular important to note that the
appearance of authenticity, an aspect of online "grassroots" media so prized by Paul Graham and
other commentators, does not guarantee the actual presence of authenticity. The tech enthusiast
website scene, which is the scene I know best, is rife with bought reviews, bogus benchmarks, and
every kind of PR-planted story. The difference is that the people who run these websites sometimes
don't have enough of a grasp of the Queen's English to pull off the kind of stylistic slickness for which
Graham criticizes the NYT, so if you didn't know better your ear might lead you to mistake them for
regular guy hobbyists who're chatting with you over the watercooler about a particularly sweet piece of
hardware that they just got their hands on. Sure, online journalism sounds candid and feels accessible
—that's its appeal—but there's usually no institutional oversight, not even a token code of journalistic
ethics and a poorly functioning and/or corrupt editorial board.

So, like its offline counterpart, the online press has its share of structural flaws, but my question to you,
the reader is, are these flaws as serious? Does the online journalism scene's much hyped
collaborative b.s. detector ultimately provide the editorial oversight that the traditional media has failed
to exercise, or is it too susceptible to manipulation and abuse? Finally, what's your take on the decline
and fall story that's currently emerging around the creaking edifice of the offline press?

Traditional Media vs. New Media – Raw, Fast and Powerful

Say EPPS Panelists

New Media vs. Traditional Media

(l-R) Jonathan Atha, , Zach Behrens, Francisco Dao and Michael Liskin

“Seven or eight years ago I was directing a story People Magazine was
breaking on Jennifer Lopez calling off her wedding to Ben Afleck,” Managing
Editor Todd Gold, Fancast.com told a standing-room only crowd of
Entertainment Publicists Professional Society (EPPS) media workshop
recently (2-19-09). “It was significant, because it was the first time People
Magazine had broken a story Online rather than saving it for the issue. It
really ushered in the every minute news cycle, and the idea of a branding a
story as you broke it was fascinating watching it break around the world. You
could almost draw a map as it was picked up in Europe, then New York and
then across the country. Now we work the same model but at different
speeds.”
“Old media and traditional media right now are suffering from many crises
and its very static,” said Gold.
“In terms of getting the message out it is old, and it does seem behind the
times, while new media is dynamic, it’s writing rules as it goes, while
tethering with some traditional standards.
Gold reported that Fancast.com gets seven million unique visitors a month,
but they pay attention to smaller sites that are running and gunning, and it
gives them a barometer of people’s interest.
“I think as a publicist, it is a good idea to pitch the big outlets like
Entertainment Tonight and every show you can think of, but because of the
Internet, you should pitch the bloggers, too,” said Former NBC Reporter and
Hybrid Journalist Shire Lazar, a
crossover media personality.

Shira Lazar

“It is good to have your story on the big shows, and influential blogs that are
not owned by CBS, NBC and the networks. They may have a better capability
of making your story more viral.”
The panelists described showbiz and political media Online as the “wild, wild
west, unfiltered, no fact checking and no rules.”
“It is fast and with the lack of filtering there are pros and cons,” said
Francisco Dai, The Killer Pitch. “In the old days when Todd (Gold) was an
editor at People we pitched him, and if he liked it he wrote it up. If he like
the story, but didn’t like you, maybe he wrote it up in maybe a negative
sense. But he did the writing and he chose the articles and it came off
professionally. Because of the speed and lack of filtering in new media,
there’s nothing like Todd to write it up for you, or nobody like him to decide
what actually deserves to be written up,” he said.
Some publicists make the mistake with new media thinking, “wow great,
now I have a platform, I don’t need to suck up to journalists, so I get to put
all our stuff out there. They put out a lot of junk, which clearly reflects on
your clients or whatever you are trying to promote. Since there is a lack of
journalistic filter, you need to learn how to filter it yourself, said the
panelists.
The panel agrees that there is a lot of fear out there about new
media. Michael Liskin, Online social networking consultant said, “People fear
new media, they don’t always understand it, they ask which social networks
do I get on, which ones are the best ones, how can I do this for my client
and in what way? It’s the integration of all the different channels and
connecting them in a way that makes sense in reciprocal connections that
can do a lot for your client and yourself. He cited Britney Spears’ site as a
doing it right. Liskin advises, “just get going with new media. It is already
happening without you anyway. So if you don’t get going, right off the bat,
you’re already behind the eight ball,” he said. “It’s very important to be part
of it, to be part of the conversation.”

Zach Behrens & Francisco Dao

One example of how old media drags its potential burst was the story about
Writer Michael Star, who has a TV column for the New York Post, and broke
the story given to him exclusively by NBC about Saturday Night Live Alum
Jimmy Fallon to host Conan O’Brien’s vacated slot on Late Night. Then a
news release came out the next day and more than three thousand articles
hit the Internet on Friday, Feb. 20, 2009. The bloggers pick it up where
traditional media left off. The old way is to give it to a site and hope it gets
picked up, but today it’s faster with sites like Facebook, Twitter and other
social networks.
“We don’t have venture capital, and I’m the only full time employee at the
site along with two volunteer writers for our large audience, but I will get 50
emails an hour while trying to write posts,” said Editor Zach Behrens,
LAist.com, one of LA’s most popular entertainment news blogs. “So a lot of
things get kicked to the side. Everyone wants to pitch us. To me a lot of it is
about developing relationships. You really have to pitch useful headlines in
your email that grabs us. For me I have found instant messaging has been
the best way to pitch.
“A phone call takes me away from everything, but instant messaging I do
things at the same time. I can get files through, and someone sitting at their
desk all day I can ask, ‘hey just a follow-up question about this story, or can
you send it to me.’ Or with people I have developed relationships on
Mondays I instant message everyone and say, ‘hey what’s going on in the art
scene this week, because I need to know about it or assign a story.’ Those
instant message conversations reduce spam. It’s like twitter, we are so
immediate and we always want to be original in our reporting, but if I am
calling for a quick quote, I’m ready to go to press in five minutes.”
“The number one reason stories viral out on the Internet is news,” said
Fancast’s Managing Editor Todd Gold. “It doesn’t change from traditional
media when you have something hot that people want to know about. The
subcategory of that is you have something quirky, funny, a twist on
whatever. Two examples: We had a Dancing With The Stars contestant
blogging on our site last season exclusively, and when she got sick and went
to the hospital she blogged about it, and it was picked up everywhere.
Or something quirky: The head of Menza gave us a list of the smartest TV
shows ever. It got picked up around the world. It is really about the best
news and information. In terms of pitching Fancast.com, we’ve been new and
under the radar. We have been making sure the usual experience is a
phenomenal one in terms of watching video.”
Fancast streams hundreds of TV shows and 9,000 hours of full length
episodes in current hits, classics and past shows so we go the experience
right. Now we combine it with editorial. “We are competing with TV Guide
and Entertainment Weekly at that level so we are looking for big stories. One
of the great things of working Online as opposed to a magazine is we have
unlimited space, we don’t worry about paper cuts, so we do as much as we
can with every pitch that our human resources allow.”
“New media runs the gamete,” said Francisco Dao, Media Consult, The Killer
Pitch.
“New media can be everything from a fan site to your twitter account. You
really need to do it all. It is fast, where I can take it or you can take it and go
directly to the audience. That’s how I see it.”
Dao cited Miami’s Basketball Star Shaquille O’Neal story. Shaq recently got
on Twitter.com and tweeted a question direct and unfiltered asking, “what
should I have for dinner at Quiznos?’ Shaq doesn’t always think about what
he’s saying and will do quirky popular things. It makes him that much more
likeable. Now, Ashton Kutcher and Demi Moore have a Twitter account but
are more careful. They still do movies, still do interviews on ET, but the new
media is the ability for everyone sitting on this panel to go direct, go
unfiltered, to have conversations with their audience. And maybe a different
conversation,” Dai said.
 According to Gold at Fancast.com, standards of quality are being
incorporated into in a new model of the future. He said, “If you are
pitching a story in a newspaper or a magazine, you’re hoping that
story is interesting enough that the reader remembers to tune into
that show or program their DVR.
“When you go on to Fancast.com, you’re getting a story, embedded
in the story you’re getting the full episode or a preview clip as well as
pictures, along with tune-in information. It is all right there and it is
immediate. People are reading the story, watching the TV show, their
watching the preview, they get tune-in info and soon they’ll be able to
hit a button and program their DVR right from that story.”

Traditional Media vs. New Media – Times they are a

changin’…quickly
Published by Jason Schultz in Marketing, Interactive on 8/5/2008

Newspapers and magazines are seeing a decline in overall readership while new media,

including the Web, online news sites and e-mail marketing, continues to increase its reach.

Although the trends indicate gloom and doom for the newspaper and magazine industry, it

looks pretty sunny in the world of new media.

A March 2008 USA Today article listed the media sectors expected to see the biggest gains by

2012. These sectors include:

Online video and rich media – Opportunities are opening to reach potential consumers with

ads in or next to Internet video clips. In addition, many sites provide interactive services.

Spending on these sites will grow 389 percent, to $12.2 billion, in the next three years.

Online search – Spending will grow 113 percent, to $26.1 billion, for ads and services at

giants, including Google and Yahoo as well as smaller providers such as ClipBlast and

Citysearch. The big attraction is that these sites, in addition to displaying ads, also generate

leads as customers click through to a sponsor's site.

Event sponsorships – Companies will spend more than $33 billion, up 72 percent from last

year, to attach their brand names to sports, music, theater and other events. The trend is

already well underway: Sponsors paid more than $2 billion last year on pro football, baseball,

basketball and hockey-related opportunities. Companies like the opportunities events provide

to connect with new customers.

E-direct marketing – Marketers will spend $22.1 billion, up 121 percent, to pitch messages

to consumers via e-mail.

Traditional forms of media have been around for hundreds of years – the first American

newspaper appeared in Boston in 1690. Don’t expect your daily newspaper or Sunday Tribune

to go down without a fight. Readers will continue to view traditional media as a reliable,

steadfast source of information. But, the shift to the Web as our main and most accessible

source of news and information is coming at us fast. And the power of new media continues to

grow exponentially. It’s crucial to the success of your brand to stay aware of the trends and

continue to look for innovative ways to reach your target audience.

Times they are a changin’ for sure. Although he most likely wasn’t referring to the Web when

he wrote those words, even Dylan himself couldn’t have predicted how quickly things could

change. He’s probably surfing the Web now, downloading his own tunes.
online marketing