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Borrell: Promotions Spending in 2013 Predicted to Surpass Ads

WILLIAMSBURG, VA.—Borrell Associates, Inc., has released a new report regarding promotional spending predictions for 2013, which indicates that promotional spending has passed advertising.

Six years ago, local businesses spent 10 percent more on advertising than they did on promotions. In 2012, they spent 81 percent more on promotions. Even as local advertising rebounds at a rate of 8 percent this year, the $101 billion predicted will be 16 percent less than in 2007. Meanwhile, local promotions are forecast to be 33 percent more than in 2007: $176 billion this year.

However, local advertising expenditures have been on the rebound since 2010. The money appears to be coming from funds usually reserved for slimmer profit margins, salaries of former marketers and from agency fees, printing budgets and postage.

This report looks first at nationwide with promotions spending. It offers definitions for the discounts, coupons, promotional products, event marketing, licensing, point-of-purchase, sampling, sponsorships, loyalty/retention programs, specialty printing, games/contests and white paper marketing, along with spending estimates for each category in 2011, 2012 and forecast 2013. It also examines local, digital and mobile promotions, showing that spending on digital promotions is expected to grow 150 percent, from $32.2 billion this year to $80.3 billion in 2017.

Two appendices indicate spending estimates for 513 U.S. Digital Marketing Regions on offline promotions and online promotions, both by national marketers and by local marketers.