STRATA Releases 3rd Quarter Agency Survey: Economic Recovery Stumbles, Political Ads Help Cable and Digital Sees Less Obstacles

Oct 19, 2010, 12:30 ET from STRATA

CHICAGO, Oct. 19 /PRNewswire/ -- Economic recovery for agencies slows as political ads dominate and digital advertising gains focus. This is according to the third quarter study by STRATA, a premier media buying and selling software provider. The survey, which follows advertising trends from leading agencies across the country, discovered that there has been a relapse in economic confidence. 33% of advertisers don't anticipate the economy and their businesses to return to a strong growth period until at least mid 2011 and 47% are seeing their clients keeping the same budget as last year.

TV is the top advertising choice followed closely by digital, but a significant growth area this quarter was cable. 31.3% of respondents say they are more focused on cable than they were a year ago.  That is a significant increase compared to the first quarter study (up 233%).  Cable's resurgence could be due to the fact it is a political year.  Over half of the agencies polled say they are competing with political advertisers for space on TV, but with a finite amount of space on TV, many advertisers are looking into alternate mediums to get their message out.  The survey revealed that cable ranked second (behind TV) for political spend, followed by radio and internet.  That doesn't necessarily mean that more dollars are going into political advertising this year.  58% say their political spend is about the same as it was during the 2008 political year and 36% say it is less than the last time around.

"The economy is not recovering as quickly as originally projected," said John Shelton, STRATA President/CEO. "Even with the increase in political advertising, spending has been fairly stagnant this quarter. We have noticed that cross-platform advertising is prevalent though, with nearly 47% saying they are doing more cross-platform advertising than ever before. Advertisers just don't buy TV or digital; they are utilizing both simultaneously to stay competitive."  

For the first time in the STRATA poll, more agencies say they see no obstacle in increasing digital spending, where in the previous survey, the majority said the lack of advertiser demand was their largest obstacle. Digital remains strong with 80.3%, with advertising agencies focusing more on digital than they were last year (up 17% compared to the first quarter).

Of the digital spend, 81.5% say online display is the number one choice of digital advertising, followed by search at 67.7%. Nonetheless, the hype of location-based advertising fell short, with 57.4% saying that location-based advertising will not be in their plans for 2011.  Those that are dipping their toes into this medium are choosing Facebook Places (24%) or Foursquare (22%).  Mobile advertising made noise this quarter, but 97% of advertisers say their clients are not requesting platforms like the iAd.

Ad networks (Yellowbook, Google, Yahoo etc.) are most likely to be used by agencies to buy digital advertising (81%), followed by purchasing through traditional media sites (TV, Print, Radio Station sites).  Search engines are the top advertising choice for online ad spend (79.4%), with social media sites coming in second (65.1%), and news sites third (36.5%).  Facebook remains the number one social media site with an overwhelming 87.9%.  

Other key findings of the STRATA survey:

  • The buzz of Apple's advertising and products seem to fall short with ad agencies. Of the mobile advertisers, iPhone remains the top choice (82.7%) but is losing ground to Android devices that have witnessed 9% boost since the last quarter (50%)
  • Print remains weak with 60% of agencies saying they will focus less on Print than they did a year ago.  58.2% said they felt that Print cannot be saved
  • Agency's biggest challenges this quarter are Client Spending (down 18% from 2Q09) and Client Attraction (up 42% since the last survey)
  • 44% also project this quarter to be better than the first half of the year (while encouraging, that's down 8% from the previous two quarters)  
  • The number one mobile advertising avenue is display advertising (48%) followed by advertising through SMS (23.3%)

ABOUT STRATA

STRATA is the nation's leading provider of media buying and selling software.  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.    

The whole-scale changes that are occurring in this fragmented media landscape require a customizable and convergent solution. STRATA provides the technology to enable organizations to lead rather than react. By transforming the way advertisements are placed and tracked, STRATA adds efficiency and precision across traditional and emerging platforms.

Headquartered in Chicago, STRATA has been supplying solutions to the media buying and selling industry since 1983.  STRATA is owned by Comcast Cable http://www.comcast.com. For more information, visit www.gotostrata.com or call (800) 9 STRATA

For more information: www.gotostrata.com, www.facebook.com/STRATA and on Twitter - @gotostrata

SOURCE STRATA



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