After years of steady increases in online advertising, analysts are adjusting their forecasts to show the first real decrease since the dot-com bust.
- Web Analytics, SEM News: Free Tools, Guides, Resources
- ChoiceBot Personalizes Product Recommendations
- How-To Guide: E-Commerce Marketing on Facebook
- E-Commerce Design: How to Set Up Web Site Navigation
- Online Video Ads: Affiliate, AdWords News, SEO Tips, Trends
- Survey Says: Customer Interaction Key to Online Sales
Cautiously Optimistic"The current consensus amongst economists is that the recession will end this year, and with it, online advertising will hit its stride again," he said. "This winter shall pass, too." Online advertising has long been the beneficiary of what financial types call a secular shift, referring to the economic ripple from a fundamental change in people's habits. As people have come to spend more and more time online, advertisers have shifted their spending accordingly. So while the growth rate of online advertising has been trending down as the recession has deepened, total spending has still been increasing by a year-over-year basis. By contrast, in more mature sectors particularly print advertising real declines are common in steep economic downturns. Online retail has experienced a similar phenomenon. With e-commerce steadily marching into the mainstream, the sector has enjoyed much steeper growth rates than the offline channel over the past several years. But in the fourth quarter of 2008, e-commerce spending declined 3 percent from the previous year, according to online metrics firm comScore. That's a steep comedown from the growth rates of around 20 percent retailers enjoyed throughout 2007.
The Top Performer: Paid SearchWithin the online ad market, not all sectors have fared equally. Paid search has been the best performer, offsetting sharp drops in display and classified spending.
In the fourth quarter, IDC reported that search spending increased 10 percent year-over-year, compared to a 7 percent dip in display and an 18 percent drop in classifieds.
All told, spending growth was just slightly better than flat for the quarter, up a modest 0.4 percent to $7.13 billion, compared to $7.10 billion in 2007.
"All of this does not bode well for the current first quarter," Weide said.
IDC, which had previously projected 10 percent growth in ad spending for all of 2009, plans to release its revised forecast in March.
This article by Kenneth Corbin appears courtesy of InternetNews.com.
|Do you have a comment or question about this article or other e-commerce topics in general? Speak out in the SmallBusinessComputing.com E-Commerce Forum. Join the discussion today!|
Mobility & Cloud are Changing the Face of Visual Communications On-Demand Webcast Thanks to mobility, visual communications tools are becoming increasingly pervasive, with high user-expectations. Cloud options...
7 Ways to Get the Most Out of Ad Hoc Meetings Things come up at the last minute, and sometimes you need to call a meeting on the fly. Ad hoc meetings are becoming more and more common in the...
Mt. Washington Pediatric Hospital - Protecting Children's Privacy with Zix Mt. Washington Pediatric Hospital has always been committed to guarding the privacy and personal health information of their patients. They worked...
Disk Encryption + Endpoint Backup: Before You Lock it Down, Back it Up Full disk encryption is the ultimate data guardian on corporate endpoints. But when deployed without endpoint backup, it can also be the ultimate...