U.S. Marketing Spending To Exceed $1 Trillion In 2005

First Sizing Of Corporate Marketing Shows Manufacturers Spending Most

MAYNARD, Mass., June 1, 2005 — Communications and research consultants Blackfriars Communications, Inc. (Blackfriars) today announced that they project marketing spending at U.S. companies will be nearly $1.074 trillion this year. In their first ever sizing of the U.S. marketing market, they found that if marketing were a vertical industry, it would represent about 9% of the gross domestic product of the United States, and it would rank as the fifth largest industry, behind manufacturing, government, real estate, and professional services.

"It is widely known that companies spend a lot of money to market their products, but most people do not realize how large an activity it really is," said Carl Howe, a principal of Blackfriars. "Our research shows that marketing spending by all companies this year will be somewhat larger than the contribution to the gross domestic product of the entire finance and insurance industry. That's a big business."

To determine the size of U.S. marketing spending, Blackfriars collected data from 300 senior business executives about their marketing budgets, attitudes, and spending. Blackfriars then correlated this data with overall business spending information collected by the 2001 U.S. Census and with gross domestic product data provided by the U.S. Bureau of Economic Analysis.

Survey Shows Manufacturers Spend The Most Dollars On Marketing

Blackfriars broke down 2005 marketing spending into nine categories of marketing activity. It further analyzed its data to detail marketing spending in six vertical industries: financial services; information and media; manufacturing; other services; professional, scientific and technical services; and retail trade.

A key finding in Blackfriars' analysis proved that industry affiliation has a big effect on marketing activities and spending. It found that manufacturers will spend the most this year on marketing, projecting a nearly $120.1 billion budget. This marketing budget includes advertising, direct marketing, events, and other activities. Yet manufacturers won't spend the most money in every category of marketing. When it comes to direct marketing, for example, retailers will spend $24.5 billion this year, more than two dollars for every dollar that manufacturers spend.

"Today, manufacturers spend the most on marketing, largely because they represent nearly $1.5 trillion of the U.S. gross domestic product. But retailers actually spend a higher percentage of their revenues on marketing, and they invest more in measurable activities like direct marketing and online promotion," said Howe. "This research allowed us to measure not only how much money was being spent on marketing, but also let us compare how diverse industries spend their marketing dollars in different ways."

Blackfriars has published a 20-page research report titled "Marketing 2005: Sizing US Marketing" that provides detailed analysis of this projection. Included in this report are 2005 projections for marketing spending overall, projections of marketing spending by type of activity, and analysis of marketing spending in six vertical industries. This report is available for $495 directly from Blackfriars. Blackfriars has also published a May report titled "Marketing 2005: Q2 Marketing By Industry" that provides percentage benchmarks of actual first quarter 2005 spending and projections of second quarter marketing budgets with detailed analysis of marketing spending in six vertical industries. Both reports are also available through MarketResearch.com, ResearchandMarkets.com, SourceMedia.com, and their affiliates.

About Blackfriars Communications, Inc.

Blackfriars Communications, Inc., headquartered in Maynard, Mass., improves how organizations communicate through consulting, executive training, and research services. With more than 25 years of experience in high technology, marketing, and training, Blackfriars employs objective methodologies to help companies distill, communicate, and deliver their value. On the Net: Blackfriars Communications, Inc. site: http://www.blackfriarsinc.com.