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i m talking about total advertising as a share of GDP[1]. The shift to digital is naturally following the eyeballs of users. Google's profits rocket while othe

i m talking about total advertising as a share of GDP[1]. The shift to digital is naturally following the eyeballs of users. Google's profits rocket while others' fall. The question is, did this shift drive increased consumer spending ? https://www.researchgate.net/profile/Rachel_Soloveichik/publication/320618148/figure/fig2/AS:553454859767808@1508965329425/Advertising-Revenue-as-a-Share-of-GDP-Percent.png https://www.researchgate.net/profile/Rachel_Soloveichik/publ...

mrmrcoleman 7y ago
That's a fair question, thanks for the link.
danso 7y ago
But isn't digital advertising substantially cheaper than traditional ad buys (e.g. print, TV)? If clients can spend much less to reach the same number of potential customers, why is it necessary for them to spend equal to or more than a traditional ad budget?
- mehh 7y ago
  Cheaper than TV per eyeball, typically no, minimum spend on TV is higher because of the minimum purchase (i.e. number of impacts for your demographic for a spot is typically high). TV typically caters for the big brands who want the mass public to know about their brand/product. Targeted advertising is starting to emerge on TV, where you basically have the digital model of targeting and ad at an individual, the cost per individual is then higher than broadcast ads.
- lkrubner 7y ago
  If the ROI was higher, then they would spend more. Simple as that. But not company has done this, suggesting the ROI is not as good as was thought circa 2010.
  - kortilla 7y ago
    Diminishing returns. Once your total addressable market knows about you, slamming it with ads isn’t going to help.
    - mrguyorama 7y ago
      Explain that to the assholes who blast the same three advertisements on most TV channels 24/7
sologoub 7y ago
You are missing a lot of other shifts. For example, in a retail business, location is a form of marketing spend - if you rent in a high traffic area, you’ll pay more for the location, but will need less marketing dollars to attract the same customer. Now, how does that apply to e-commerce? I don’t see the linked chart showing these changes. There are many other structural shifts that a simple trend in a given Ads sector would show.

mrmrcoleman 7y ago

That's a fair question, thanks for the link.

danso 7y ago

But isn't digital advertising substantially cheaper than traditional ad buys (e.g. print, TV)? If clients can spend much less to reach the same number of potential customers, why is it necessary for them to spend equal to or more than a traditional ad budget?

mehh 7y ago
Cheaper than TV per eyeball, typically no, minimum spend on TV is higher because of the minimum purchase (i.e. number of impacts for your demographic for a spot is typically high). TV typically caters for the big brands who want the mass public to know about their brand/product. Targeted advertising is starting to emerge on TV, where you basically have the digital model of targeting and ad at an individual, the cost per individual is then higher than broadcast ads.
lkrubner 7y ago
If the ROI was higher, then they would spend more. Simple as that. But not company has done this, suggesting the ROI is not as good as was thought circa 2010.
- kortilla 7y ago
  Diminishing returns. Once your total addressable market knows about you, slamming it with ads isn’t going to help.
  - mrguyorama 7y ago
    Explain that to the assholes who blast the same three advertisements on most TV channels 24/7

sologoub 7y ago

You are missing a lot of other shifts. For example, in a retail business, location is a form of marketing spend - if you rent in a high traffic area, you’ll pay more for the location, but will need less marketing dollars to attract the same customer. Now, how does that apply to e-commerce? I don’t see the linked chart showing these changes. There are many other structural shifts that a simple trend in a given Ads sector would show.