The beginning of this month saw the release of two reports on ad expenditure from opposing ends of the market which drew unsurprisingly different conclusions with regard to predictions for growth. In the latest Myers Report, New York economist Jack Myers has revised his ad revenue estimates for the coming year claiming that the decline in the US economy “is much deeper and of longer duration than we anticipated. We are in a genuine advertising recession, and we can expect some radical belt-tightening and shifting of business plans and strategies.”
In December 2000, Mr Myers put ad spend growth for 2001 at 4.9% – at a time when, year on year, spending increase sat at 9% – and in April adjusted his figures to 2.4%. Today Mr Myers has predicted a decline in ad spend for 2001 of 1.5%.
Meanwhile eMarketers latest eAdvertising report forecasts a sunny outlook for emarketing, predicting a 7% increase in online adspend by year end 2001. The report is compiled using data from a variety of media watchers including Jupiter, AdRelevance, Morgan Stanley and…The Myers Group. Jonathan Jackson, eMarketer senior analyst stated “Online advertising is alive and well, even though it has been impacted by a significant economic slowdown. Although several investment banks and industry nay-sayers have recently been predicting a negative growth rate for online advertising this year, eMarketer sees continued strength in the medium, particularly because of its targetability and measurability.”
Within traditional media, predictions for the coming year currently range from Myers dismally negative 1.5% decline in spending to around 2.5% growth. The rosy outlook of the emarketeers is not without good reason though, recently Morgan Stanley speculated that reduced price banner ads can provide excellent cost-effective branding tools. Companies looking to reduce their overall marketing spend are able to take advantage of excellent CPMs afforded by online advertising.
