Tuesday, March 18, 2008

Online Advertisers To Spend Through Turbulence

MARCH 18, 2008

The shift online will continue in 2008.

eMarketer predicts that, despite the economic rough patch, US online advertising will continue to grow through 2008. Online ad spending will rise by 23%.

Yet even that reduced rate of growth will continue to top total media ad spending, maintaining online advertising's position as the fastest-growing media in terms of ad spending.

"Several elements unique to the Internet will support continued US ad spending growth even if other media falter," said David Hallerman, senior analyst at eMarketer.

"The greater ability to measure ads online will likely encourage marketers with reduced budgets," Mr. Hallerman said. "Those same marketers are finding that the audiences they need to target are spending more of their media time on the Web."

Search will account for the largest portion of online ad spending in 2008, at 40%. That percentage will decrease slightly through 2012, when it will account for 37.3% of US online ad spending.

Conversely, spending on rich media and video advertising is set to grow as a percentage of online ad spending, rising to 18.5% in 2012 from 10.2% in 2008.

eMarketer predicts that total US advertising spending will grow by 3.3% in 2008.

Advertising Age recently reported that other analysts have also predicted total media ad growth.

Speaking at the American Association of Advertising Agencies' Media Conference and Trade Show, Bear Stearns analyst Alexia Quadrani said US ad spending would increase 4% in 2008, up from an estimated 3.3% in 2007.

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