Approaches

BT_Insight

Online Resiliency in the Recession

April 08, 2008

Posted by: Gavin Thomas in Online

It seems like every time we turn on the news on television, tune into the radio, or fire up our favorite news site on the web, we are bombarded with segments discussing our economy’s current sluggish state.  As we all know, analysts and economists often spend more time arguing over whether or not it is proper to call the situation a certain “recession” than they do analyzing the reasons for the downfall or current trends the economy is facing.  No matter what we choose to title these hard times, there are few industries that go unaffected.

This is clearly apparent in the world of advertising.  Even in a year with the Olympics and a Presidential election – usually both ad goldmines – ad spending has taken a hit that matches that of the economy.  However, there is one medium that seems to be standing up to the pressure of this recession.  According to David Hallerman, eMarketer Senior Analyst, “US online advertising is proving to be far more robust than other media channels.” eMarketer predicts that this year’s online ad spending will account for around 8.8% ($25.9 billion) of total US ad spending.  This number is predicted to reach 10% by next year.  While it is important to keep in mind that no media channel is immune to the negative impact of a struggling economy, it is also interesting to think that the first medium to be cut in the past (online spending) is flexing its muscles and at least standing up to the recession.

In 2007, Butler/Till spent around 14% of our clients’ total budgets on online and interactive media opportunities.  According to Peter Platt, VP of Online Media at Butler/Till, this number could reach 20- 25% of total spend in 2008.  These numbers meet and exceed the industry outlook for the upcoming year.  As mentioned, a recession can adversely impact most everything, especially in the world of ad spending.  However, it is good to know that there is at least some light at the end (or perhaps more accurately – at the middle) of the tunnel.