Spending on Brand Activation Rises to Nearly 60% of Ad Budgets

New Study Provides First All-Encompassing Definitions of Brand Activation Disciplines, Platforms, and Channels

ANA Study Provides First All-Encompassing Definitions of Brand Activation Disciplines, Platforms, and Channels

CHICAGO, IL — Spending on brand activation marketing in the U.S. rose 5.5 percent in 2015 to more than $560 billion, accounting for almost 60 percent of advertisers’ budgets, according to a just released study by the Association of National Advertisers (ANA) in partnership with PQ Media. This year, brand activation is expected to grow 6 percent, to nearly $600 billion.

The study, called The U.S. Brand Activation Marketing Forecast 2016, provides the first market research to clearly define, segment, size, and analyze brand activation by platform, channel, and end-user sector. The study defines brand activation marketing as the convergence of media platforms and channels to shape the way consumers experience brands by employing actionable marketer insights and strategies to bring a brand to life. What defines strong brand activation is the way they are used together, and with traditional media, to drive results through consumer behaviors and actions.

Spending on brand activation, which including relationship, influencer, promotional, content, experiential, and retailer marketing accounted for 59.8 percent of overall marketing expenditures. Retailer marketing includes shopping mall and in-store digital signage, in-store mobile marketing, and place-based digital out-of-home media networks.

At the same time, spending on traditional and digital measured advertising represented 25.2 percent, and investment in trade promotions came in at 15 percent. The latter includes primarily brand spending in which brands work directly with retailers on promoting select products or services. The report also projected that brand activation spending will top $740 billion by 2020. It is the first study to provide a clear definition of brand activation and to measure the size of the industry.

The report predicted that brand activation spending would continue to outpace spending on advertising and trade promotions over the next four years, and included the following findings:

  • The number of media channels has tripled in the last 40 years, with media buyers now choose from over 200 options
  • Technology and data are affecting the media buying process with the advent of omni-channel campaigns
  • Technological advancements, such as virtual reality, will affect how consumers engage with marketing in the future
  • IAbout 57 percent of brand activation marketing is outsourced to media and other companies
  • Relationship marketing is the largest of six brand activation marketing platforms, while content marketing is growing the fastest.
  • Customer services and telesales are the largest of 32 brand activation channels; however, mobile apps and proximity services are growing the fastest.
  • Automotive is the largest category of 21 industry verticals using brand activation marketing, at $54.5 billion in 2015.

“This report is groundbreaking in that it represents the first comprehensive examination of this industry,” said Bob Liodice, ANA president and CEO. “The ANA and our partner in this initiative, PQ Media, are putting a stake in the ground and stating definitively that brand activation — across both B-to-C and B-to-B includes six platforms and 32 channels.”

“End users are spending more time with media, but they are less engaged with advertising and marketing as a result of several key trends, including the fast growth of smart-tech products and mobile media, consumer adoption of ad-skipping devices, increased media multitasking with digital devices, and the growing consumption of media outside the home,” said Patrick Quinn, president and CEO of PQ Media. “As a result, it’s imperative for brands to more effectively use media strategies and channels that provide opportunities for higher engagement. And strong brand activation marketing will develop emotional connections with target audiences to drive brand loyalty.”

Work on The U.S. Brand Activation Marketing Forecast 2016 began in mid-2015 and was completed in April of this year. The report will be available to ANA members in May.

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