Barclays Reduces '09 Online Ad Forecast To 6 Percent Growth; Total Ad Spend To Fall 10 Percent

This story was written by David Kaplan.
Another day, another ad spend downgrade Online advertising will grow a paltry 6.1 percent to $25.1 billion next year, says Barclays Capital internet analyst Doug Anmuth, in his latest significant downward revision. It was only October when he predicted that web ad dollars would grow 16.9 percent. That was revised down from May's expectation of 23.4 percent. But as a commenter said on an earlier ad spend outlook, some growth is better than none. And the U.S. total ad spending looks to plummet 10 percent to $252.1 billion, Anmuth now says, altering his previous -5.5 percent projection.

As for the good news, that will have to wait until 2010, when Anmuth says internet ads should reaccelerate to 12 percent, reaching $28.1 billion. Anmuth's '09 forecast is in line with some other prognosticators' views from this month:

Magna Global's Bob Coen has downgraded his '09 forecast for U.S. online ad spend to 8 percent growth from his earlier call this summer for web ad dollars to rise 12 percent.

WPP's GroupM expects 5 percent online ad growth in '09, way down from GroupM's expectation for 16 percent gains this year. Worldwide, internet ad growth is predicted to slow from 22 percent in 2008 to 10 percent in '09

Sticking to the bullish end of the spectrum, ZenithOptimedia is forecasting online ad growth of 18 percentboth for worldwide and North Americanext year. As for this year, 21.2 percent online ad spending growth. More after the jump.

Getting back to Anmuth's online outlook, the Barclays analyst is seeing anemic 4 percent growth in display, while search still remains surprisingly strong with 20 percent gains. That is rounded out by further weakness in the "Auctions and Other" category, which is slated to drop 2 percent. Lead gen and e-mail marketing is tracking the overall internet space and should be up only 5 percent.

As for his rosier 2010 forecast, Anmuth is calling for a comeback for display (12 percent growth), a slowdown in search (up 15 percent) , a rebound in "auctions and other" (5 percent gains) , and a slight uptick for lead generation and e-mail (climbing 6 percent).


By David Kaplan

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