Financial Crisis Sends Ad Forecasts Down, But Online Still Looks Healthy
This story was written by David Kaplan.
For those looking to how online advertising is likely to weather the global financial meltdown, forecasters still seem relatively hopefulat least compared to traditional advertising. Still, it helps to keep in mind that both ZenithOptimedia and Barclays Capital (formerly Lehman Brothers) internet analyst Doug Anmuth tend to be optimists. However, given the daily drumbeat of dire economic news, the meaning of optimism is being revised downward as well.
-- Zenith: The Publicis Groupe media buyer's latest forecast expects global internet ad spend to grow 23 percent between 2007 and 2010down from its June prediction of 26.7 percent during that period. Online'sshare of the world ad
market is also expected to rise from 8.6 percent in 2007 to 13.8 percent in 2010a revision upward from 13.6 percent in our last forecast. In part, that's due to traditional media's shrinkage in the face of greater economic pressures leading to a pullback from major marketers. Overall, Zenith is forecasting the world's total ad spend gains to come in 4.3 percent in 2008, which is a retreat from the 6.6 percent growth predicted in its June forecast. Looking to 2009, the total ad expenditure growth has been downgraded from 6.0 percent to 4.0 percent.
-- Barclays: Anmuth is significantly lowering his U.S. online ad forecast for 2008 through 2012 (PDF, not online), projecting ad spend of $24.79 billion (+16.9 percent), way below his previous forecast of $26.17 billion (+23.4%) in May. He expect online advertising to grow at a 14.3 percent three-year compound annual growth rate (CAGR), resulting in the web accounting for 13 percent of total U.S. ad dollars by 2011. Anmuth adds: "Additionally we project growth to accelerate in 2010 based on our assumption (hope) that the economy shows signs of improvement after 2009." More to come
By David Kaplan