STRATA Survey: New Challenges Emerge As Advertising Economy Strengthens In Q1 2013 Changes in Social Media Utilization and ROI Questions Linger

CHICAGO, May 29, 2013 /PRNewswire/ -- Media buying agencies are experiencing major business growth and expect that growth to strengthen throughout the rest of the year, according to the latest quarterly survey conducted by STRATA, the leader in media buying and selling software.

The recent study revealed that almost half (48%) of agencies polled said business is increasing this year over the same time last year; while 39% expect to see more growth in the first half of 2013 than the second half of 2012. This growth has led to many shops expanding their business as 39% plan on hiring this year (the largest amount since the first quarter of 2012). This is fueled by the fact that 28% say their clients are increasing their Marketing/Advertising budgets from last year.

Even with more cash available, advertisers continue to spend on core channels. Compared to all other media types - TV was the most utilized avenue last quarter at 48%, followed by Digital (34%) and Radio (9%). When asked about their approach to TV, respondents were more interested in spot cable than they have been in five years (32% were more interested in cable than they were a year ago). Spot TV also saw a spike in interest, up 22% from last year.

While these signs of an increase in business are encouraging, they do present unique challenges. Finding new clients has become a new difficulty for agencies, as 53% stated that client attraction is their biggest challenge (the highest number in the history of the STRATA survey and 49% higher than the first quarter of 2012). The second largest challenge was client spending (18%). However, most agencies are taking on this challenge by focusing more on business development (69%), and 47% say they will even expand into new advertising areas (such as streaming or online radio/TV).

"The advertising economy is back, thanks to the return of the big spenders. Home improvement, financial services and automotive companies are the driving forces, which is always a sign of a strong ad economy," said John Shelton, CEO and President of STRATA. "Advertisers will continue to use newer channels and further expand the media mix moving forward, even as traditional TV and Cable spending will maintain their hold on the top ad revenue."

Powered behind a nearly even split between Online Display (73%), Search (68%) and Social Media (61%), Digital is an increasingly strong option for advertisers. In the first quarter, 76% said they are more interested in digital than they were a year ago (up 51% over 2011). A couple of newer advertising options are on media buyer's radar this year. Streaming/Online Video is one area where agencies are taking a strong interest. In the study, 46% of respondents say they are more interested in this option than a year ago. Streaming/Online Radio also looked even more promising with 54% saying they are more interested in this than last year.

Social Media continues to be a hot and dynamic trend. Sixty-seven percent of respondents use free social media to support client campaigns. In terms of a return on that investment (ROI), 22% say their clients don't see ROI on Social. It is fairly split when comparing paid versus free Social Media, 20% say they see better ROI on paid Social and 18% say they see better ROI on free Social. When comparing social media options, Facebook is still the top choice for advertisers at 78% (though this is Facebook's lowest number ever seen in the STRATA survey). Twitter is the second choice for marketers (39%), while YouTube comes in at third (31%). Pinterest continues its rapid growth as it vaults to fourth at 22% (up 104% over last year).

While Social and streaming options are gaining momentum, agencies are saying that a couple of the trends buzzing on Madison Avenue have yet to catch on with Main Street. 76% of agencies said they either have the same or less interest in Second Screen advertising than a year ago. Only 9% of respondents said they were more interested in gaming advertising than last year.

Other key findings:

  • 26% expect their business to return to a strong growth period by late 2013
  • 21% are more interested in radio than they were last year
  • 64% say they are less interested in print than they were a year ago
  • Out of Home witnessed a small bump with 22% more interested than a year ago
  • iPhone is still the top mobile option for advertisers (83%) with Android second (67%)

ABOUT STRATA
STRATA is the only system provider that connects both media buyers and sellers. The custom solutions supplied by STRATA empower clients to sell and efficiently purchase all media types including cable, broadcast, newspaper, radio, outdoor and digital advertising mediums.  On average, over $50 Billion in advertising dollars flow through STRATA systems per year.   

As the system of choice for over 1,000 agencies nationally, STRATA provides media technology that enables organizations to lead rather than react to industry developments.  By transforming the way advertisements are placed and tracked, STRATA adds a new level of transparency to campaigns that is necessary in the ever-evolving media world. 

SOURCE STRATA



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