Online ad spending drop
ADOTAS — The rosy murmurs of revenue growth from some online companies might be thinly sliced pap if a new report, which predicts the first contraction in online ad spending since the dot-com bust, is right.
Online advertising could fall by 5 percent in the first quarter of 2009, the IDC said. The market research group said the U.S. Internet ad market could get worse in the second quarter before the situation improves in the second half of the year. The report suggests that the low double-digit growth rates that were predicted were overly optimistic.
IDC says that while world-wide Internet ad spending continued to grow at a muted pace, fourth-quarter U.S. Internet advertising sales were much worse than anticipated, up just 0.4% to $7.13 billion. It said while first-quarter search ad revenue will not collapse, growth will continue slowing, and display and classified ads will most likely show worse declines than in the fourth quarter of 2008.
And why the drop? According to Techcrunch, the industry has gotten lazy when it comes to advertising innovation, and too much outsourcing to the ad networks.
– Express your opinion, comment below.
Reader Comments.
With all the talk of doom and gloom in online advertising, I’d like to say that our online ad network, Kitara Media, is growing dramatically and we are helping web site publishers expand, not contract. We’re adding dozens of web site publishers each week and the ecpms are up, not down, and they are earning more money not less. While there’s less high cpm Q4 agency money, that’s a normal cycle in online advertising. Also, it’s silly to get addicted to that money, it’s not reliable. It’s not all rosy everywhere, but we’re welcoming new publishers and paying on time. Not bad for a world wide depression.
Brad
kitaramedia.com
It’s also important to note that the declines reflect all categories, and all categories have been impacted equally. While categories like automotive and finance have been decimated for obvious reasons – others like health care remain relatively strong.
Bottom line: Don’t paint the whole industry with the same brush.
R.J. Lewis
e-Healthcare Solutions
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