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New Study: Mobile Devices and Shrinking Ad Dollars Most Disruptive in Media Today

Thursday, February 5, 2009

According to a new study by KPMG LLP, the U.S. audit, tax and advisory firm, media and advertising professionals says two factors—shrinking ad dollars and mobile devices being used as personal computers—have become the most disruptive in media today. With less attention paid to traditional media channels (and more curtailed ad spend), it's expected that social media and mobile consumption will increase in usage.

In the KPMG survey, which polled more than 200 media, marketing and advertising executives, 49% of respondents indicated that declining ad spend is the most disruptive force in media today, followed closely by mobile devices becoming personal computers (40%). KPMG conducted the survey in collaboration with AlwaysOn, the venture capital new media organization.

The KPMG survey also found that some 75% of  executives predict that advertisers will move more than a quarter of media time and spending away from traditional channels in the next five years, while social networks and mobile marketing are expected to see a surge in activity. In fact, 47% of respondents indicate that the biggest lesson learned from President Obama's use of social media while campaigning is that social networks can powerfully grab mindshare in society at large. While the marketing and branding power of social networking is expected to be increasingly harnessed in the future, 61% of executives indicate that fewer than 30% of ad agencies have a plan in place to leverage the medium for their clients.

With regard to mobile marketing, KPMG found that 65% of executives say media companies currently adapt less than a quarter of their content for mobile consumption, while 27% believe the current content adaptation rate is between 26 and 50%. However, 87% of respondents say media companies will move more content for mobile consumption in the next two years.

The greatest marketing opportunity for mobile is location-based advertising, according to 48% of respondents in the survey. Games and video are also seen as opportunities, each receiving 14% of the vote. The majority of investment in mobile applications is expected to come from venture capital and the monetization of those applications is expected to come by way of advertising.

Source: KPMG LLP

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