TV Still Pulls in Majority of Advertising Dollars

Although most Americans are watching less television and spending more time on the Internet, through their computers or mobile devices, marketers are sticking with tried and true channels and advertising on television.

Over the next year, advertisers are expected to spend 3.3% more than the previous year. Television advertising itself is accounting for 34% of the total U.S. ad market, according to data from Interpublic Group of Co.’s Magnaglobal. In addition to the projections for 2011, the same study showed that TV’s share of advertising is expected to increase to 38% by 2016 for a total of $81.3 billion spent.

Major marketers are increasing spending both in TV and online as they try to negotiate how the two mediums can work together to bring more revenue. Online ad spending is expected to reach $30.1 billion in 2011, placing it as the second largest ad-supported medium. According to Magnaglobal, it is expected to reach $7.4 billion by 2016 (which will be 22% of the ad market).

What has evolved is a “two-tiered” advertising environment in which television and online advertising are at the center and other media on the periphery. The Internet has taken a large share from print advertising, which is continuing to decline. The same hit in media buying hasn’t been seen on television yet despite the growth of online viewership. Industry experts theorize that the wide spread appeal of television and the storytelling potential of television spots are keeping TV in the running.

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