downward ad spendingDown, down, down. Some major analysts have recently revised their projections of ad spending for 2009, and it comes as no surprise that the original projections of double-digit growth have shriveled into the low single digits for the sector.

UBS Equities recently downgraded its ad spending forecast to 1.4 percent growth, compared to the company's previous estimate of a 10.4 percent rise in spending.

Veronis Suhler, meanwhile, broke digital media spending out of its overall forecast. While overall US advertising is now projected to decline -0.4 percent, versus a previous forecasts of 4.9 percent growth, online will fare better.

— Internet and mobile spending are projected to grow 9.1 percent, down from previous forecasts of 15.5 percent. 

— Mobile content and video games will grow 34.2 percent and 19.5 percent respectively.

— Traditional media: newspapers, TV, magazines, and radio ad spend is forecast to plummet -16.2 percent, -9 percent, -8.5 percent, and -7.2 percent respectively.

ZenithOptimedia also revised its 2009 forecast, predicting overall US ad spending will drop 6.2 percent. Back in October, the company still saw 0.7 percent growth for the year.

More and more, agencies and analysts are pointing to the inevitable decline in the GDP, and the inextricable link between that figure and ad spending, a sentiment echoed by former Aegis CEO David Verkin (who now heads Project Canoe) at a New York Ad Club breakfast yesterday.

The ray of hope in all these dismal numbers? Search engine marketing. Rino Scanzoni, chairman of WPP's Mediaedge:cia North America said at the event that search, and only search, is the one sector still enjoying double-digit growth at Group M.

Rebecca Lieb

Published 25 February, 2009 by Rebecca Lieb

Rebecca Lieb oversees Econsultancy's North American operations.

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Comments (1)


Bryan Montpetit

Thanks Rebecca - this is some great information.

As an e-marketer, I do find too many people tend to cut back on ad spend and strategic e-marketing as a whole at the first sign of a troubled market without evaluating the actual impact that cutting these investments can actually cause.

Companies tend to treat ad spend (in any form) as a luxury instead of necessity or a viable method in which to solidify their presence in a market.

Should this not be the time that traditional methods of advertisement drop and new more cost-effective and creative methods rise?

Admittedly I understand that your post covers the general investment towards ad spend... I'm very interested in which direction these companies will take their online ad investments and which platforms will be the best suited for effective result-driven necessity.

My $0.01 - I'm keeping the other 1 cent as these are troubled times ;).

over 9 years ago

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