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Dark Days: Online Ad Spend Forecast Slashed

Written on
Sep 4, 2008 
Author
Kathleen  |
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Dark Days: Online Ad Spend Forecast Slashed

lightning.jpgADOTAS – The online advertising spend forecast has been slashed by JP Morgan Internet analyst Imran Khan due to the gloomy economic environment. Khan forecasts that long-tail advertisers will take shelter in performance-based ads and that international – not just Stateside – markets will be affected.

While Khan’s forecast for this year and next has been lowered for both display and search, it seems that display will be hit hardest. He predicts that the online display market will rake in $8.2 billion this year, down from $8.6 billion (Khan previously projected a 20% annual growth rate and the new numbers represent a shaky 14% annual growth rate).

For 2009, Khan predicts that display spending will reach $9.4 billion, down from $10 billion (representing an annual growth rate of 16%, slightly less than the 17% he predicted).

Search ad spend will be affected, but a serious downturn will been stymied by a market-wide shift to performance-based ads, Khan predicts. JP Morgan lowered the growth rates to 27% this year from 32%. And in 2009, he expects a 26% year-over-year growth.





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