Overall Ad Spending Does NOT Match Up Against Consumer Behavior

This research really excites me. What this means for those that are in the online space that are trying to get media dollars moved over from traditional sources, there is hope. It will take time, but markets are efficient and they will come to a balance or equilibrium state.

The below chart from Morgan Stanley shows how advertising vehicles like radio and especially the internet have a huge imbalance of media spent on them compared to the amount of time (usage) that the audience is spending with that media type. For the overall US media audience, the ratio is about 4.7x. Looking just at the US youth media audience, this ratio moves up to about 11.3x

Source: Morgan Stanley, SRI-Knowledge Networks, Universal McCann, Internet Advertising Bureau, Veronis Suhler