Advertising rebounds with largest year-on-year swing
Advertising, the most cyclically sensitive of the three E&M spending streams (advertising, consumer and end-user spending), recorded the largest year-on-year swing, rebounding in the US at 5.4 percent in 2010 from a 14.4 percent slump in 2009. Overall, US advertising is expected to increase at a 4.2 percent CAGR from $170 billion in 2010 to $208 billion in 2015. Internet advertising is expected to average 12.2 percent CAGR, while video games and cinema advertising, the two smallest segments, are expected to grow by 8.0 percent and 6.7 percent CAGR, respectively. Television advertising, the largest segment, is expected to grow at 4.9 percent CAGR. Directories (-1.8 percent) and newspaper advertising (-0.2 percent) are expected to be the only categories to decline.
According to the Outlook, as content providers leverage creative thinking and innovation to drive digital revenues, advertisers and agencies are becoming increasingly sophisticated in identifying and creating new brand opportunities and ways to engage with consumers on digital content services and platforms—and they're listening and engaging directly with consumers to a greater extent. These new approaches are aiding the unexpected strong recovery in advertising and restoring the attractiveness of advertising-funded models, which are often blended with a subscription model.
Rise of the Collaborative Digital Enterprise
Digitization is opening up major opportunities for new types of services, business models, collaborative partnerships and consumer relationships across the E&M industry. Advances in all these areas are emerging daily on the back of the ongoing flood of innovation in devices, delivery methods and pricing.
This is leading towards a new operating model specifically designed for the digital ecosystem— the Collaborative Digital Enterprise (CDE)—an enterprise which is technology driven and dynamic, interconnected and continuously engaged with its entire customer, employee and supplier ecosystem.
According to PwC, a collaborative digital enterprise needs to embrace three industry-wide dynamics to achieve success in the emerging digital environment: