The media business spent the first part of the year insisting that the slowing economy wasn’t affecting advertising. By mid-summer, that had finally changed, and a host of prognosticators started whacking their growth estimates. And now that the debate has shifted from “are we in recession?” to “recession or depression?” it’s time to whack those estimates yet again.
The U.S. advertising marketplace is now expected to expand only 1.6% in 2008, and 0.7% in 2009, down from the agency’s last forecasts in June of 3.4% and 2.6%, respectively for 2008 and 2009.
Noting that North American and Western European regions have been most adversely impacted by the reduced liquidity in the financial markets, ZenithOptimedia nonetheless also lowered its global ad growth estimates dramatically to 4.3% in 2008 and 4.0% in 2009 vs. its June predictions of 6.6% and 6.0%, respectively.
Next up – Lehman/Barclay’s Doug Anmuth, who takes aim at online ads specifically this morning:
We now project total 2008 U.S. online advertising of $24.79 billion (+16.9%), below our previous forecast of $26.17 billion (+23.4%), due to contracting advertising budgets and a weakened economic outlook. We expect online advertising to grow at a 14.3% three-year CAGR, resulting in the Internet accounting for 13.0% of total domestic ad dollars by 2011 using Barclays Capital’s updated domestic advertising forecast. Additionally we project growth to accelerate in 2010 based on our assumption (hope) that the economy shows signs of improvement after 2009.
Here’s a nice summary of the summer’s re-evaluations. Expect plenty more:
- August 27: Carat drops overall ad forecast, but raises online advertising outlook to 23.7% growth in 2008
- August 13: eMarketer plans to drop “a few percentage points” off its March estimate of 22.7% growth
- July 7: BMO Capital Markets cuts its 2008 U.S. forecast to 1.8% from 3.6%
- June 30: Zenith Optimedia cuts its U.S. ad forecast for the second time in three months
- May 30: Lehman drops 2008 U.S. online ad forecast from 24% growth to 23%
- March 19: eMarketer cuts its 2008 online ad forecast 6%
- September 14: Oppenheimer cuts 2008 U.S. online ad estimate 26% growth to 25%
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