Six Pixels of Separation - The Blog
April 1, 200910:31 PM

Always Remember Marketing Is Not Advertising

It's not just traditional mass media advertising that is being affected by the economy. It turns out that Web advertising is beginning to show signs of economic woes as well, but make no mistake about it, Digital Marketing is still growing and people are still spending money getting their brands online.

Does that confuse you? It should not.

Advertising is only one sub-set of Marketing. It's not the entire Marketing sector (at all).

AdWeek reported a couple of days ago that even though Internet advertising is still going to grow this year, it is showing signs of slowing down:

"The Interactive Advertising Bureau released its fourth-quarter and full-year U.S. online ad spending report for 2008, which showed the overall industry growing 11 percent for the year to reach $23.4 billion. The effect of the economy, however, was clear in Q4, when the $6.1 billion of ad spending, while marking the highest level yet recorded, represented a year-over-year increase of 2.6 percent. The 4.6 percent sequential quarterly spending growth was the lowest since 2002."

The keywords in this quote from the news item titled, Web Ad Growth Deteriorates, are "ad spending." Brands are definitely watching their ad spends with much more scrutiny, but it's very important to remember that advertising and media buys are only a small portion of the overall Digital Marketing industry. According to this report, "search revenue accounted for 46 percent of 2008 fourth-quarter revenues, up from the 42 percent reported in 2007. Display Banner advertising, the second largest format, accounted for 21 percent, followed by Classifieds (13 percent), Lead Generation (7 percent) and Rich Media (7 percent) of 2008 fourth-quarter revenues."

The report does not account for email marketing, affiliate marketing, the ROI of creating (or being engaged in) some of the more conversational (or Social Media) channels, etc... It also does not include what companies are putting into their websites, micro-sites or even more experimental channels like iPhone apps, contest, etc... It is only about the online advertising spend.

If traditional advertising is taking a hit (and it is), it's only natural that online advertising feels some of that pain, because - for the most part - those big, massive media buys are being managed by the same media companies or their interactive arms.

To really see what's happening in the Digital Marketing space, it would be interesting to know if companies are also slowing down in their overall online initiatives, and not just the advertising dollars.

By Mitch Joel

Comments Comments Feed
  • Posted by Seth

    So, what is going to be the next big thing in online advertising. I think that is the question. What is the new and innovative way to reach consumers and b2b in a way that is engaging and relating without trying to sell people? We are almost too connected.

  • Posted by Chris Goward
    Mitch Joel

    To your point, Mitch, we've definitely seen a spike in interest for our Conversion Optimization services since Dec '08. Everyone seems to want to maximize conversions from the traffic they're already getting without increasing their ad budget.

    Good meeting you today at SMX.


  • Posted by Charles Neville
    Mitch Joel

    A lot of people (hopefully not marketers!) get marketing confused with advertising. Advertising sounds more glamourous, ad agencies have impressive offices, throw great parties. Truth is ad agencies only exist because they can do one part of the marketing mix better than advertisers, yet the ad agency is hired by the marketer, not the other way round.

    With so many other ways to market your product, online and offline, advertising can often be an expensive waste of a marketer's attention.

  • Posted by Ari Lestariono
    Mitch Joel

    I really don't care about the economy depressions, It's all up to us to succeed.The only way you are going to succeed in this business, is you have to crushed it, stop crying, whinning stop watching tv, do hardwork every day.good luck

  • Posted by Claire Mills
    Mitch Joel

    Mitch - would you consider allowing me to include a blog post or article on our MARCOM Marketing Wisdom blog? This is such perfect content and the point we are trying to make that I'd really like to feature you on it.

  • Posted by Olivier Sefler
    Mitch Joel

    Hi Mitch,
    Some had expected that e-marketing budget growth would remain untouched by the crisis as theorically a lot of money would flow from traditionnal activities to online activities which are much more measurable. However, this did not take into account the internal reallity of many corporation. Among other things, the crisis state of mind is probably inhibiting bold moves at different levels. I think we are entering a testing phase where marketers will build their knowledge on different online opportunities and online platforms (social networks, widget...) will have not choice but to adapt their offer to the marketers needs to survive. When the crisis will be over, I would not be surprised to see a dramatic rise in online marketing budget.

  • Posted by Ashwani Singla
    Mitch Joel

    I agree, digital marketing is the in-thing today.

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