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Online Advertising Stinks It Up Again With Paltry 15.6% Growth



Here we go again. The Interactive Advertising Bureau released the numbers for online marketing performance for the first half of 2008 and the verdict is in. Once again double digit growth sucks and everything is going to hell in a hand basket. I just thought I would let you know this so you can stop doing business in an industry that continues to grow.

The take on these numbers comes from the LA Times this time. Would you please indulge me in a quick question before I get to the story here? Since I am not a trained journalist I was wondering if it is actually taught to build a story using something I call the ‘Chicken Little Method’. It appears to work like this: The intro and first part of the story must state that everything is dire and then at the end of the story (which is read by far fewer folks than the open) you temper your ‘views’ with this crazy thing we like to call reality.

I digress. Back to the point. First half of the year online advertising grew 15.6 percent. Ouch! Slacker alert! Well, the author quickly points to the apparent decline in these growth numbers. First half of 2006? Year to year growth 36%. First half of 2007? Year to year same period growth 27%? See the trend? Next year it looks like we could flat line as an industry. Get your revenue now because it looks like this gravy train is grinding to a halt. There is no mention. However, that such large percentage growth occurred on much lower numbers so the percentage is skewed. Most journalists and those folks who measure growth fail to remind people of some of these simple precepts. In this world of quick scan and shallow understanding most will read the beginning of that article and further depress themselves considering the overall state of doom and gloom that we love to wallow in and read about 24/7 these days.

Here are the two quotes that will help you get this picture:

From the glass half empty camp: “From what I see, this is a similar pattern to the last slowdown in 2001,” said David Silverman, a partner in the entertainment, media and communications practice at PricewaterhouseCoopers, which worked with the IAB to come up with the numbers.” Thank you very much Mr. Silverman for acting like 2001 and 2008 have the same factors and influences as it relates to the use and understanding of the internet.

From the glass half full camp: “All advertising is somewhat depressed, and online advertising has fared better than average,” said Joe Apprendi, chief executive of Collective Media, a New York-based online advertising firm. “It’s going to grow, which isn’t the case with all media.” While not glowing, it does state that growth is the expectation thus giving reason for hope.”

Whether you are half full or half empty person I beg of you to pay less and less attention to these measurements and prognostications. What do you see as you work in this industry on a day to day basis? You are the feet on the streets. Give us the feedback of what you live as a practitioner rather than what some analyst (look at the root of that word for where I believe they pull most of their information from ;-) ) tells us. I like my information based on real life. By the way, from what I see the glass is half full and filling up.

  • Pingback: US Online Ad Growth Slows - (but still growing) | The Inside Angle

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  • http://www.theinsideangle.com/2008/10/08/us-online-ad-growth-slows-but-still-growing/ Andrey

    Definitely agree with you Frank. I can see how the financial types would see it as a negative since they have models that are based off more aggressive numbers, but for more general demo targeted news sources – or sources in our industry, it’s still good news that the industry is growing at a high percentage – especially with all the other news about the economy tanking.

  • http://www.speak-tome.com Ted Murphy

    Hah, yeah up 15.8% is actually excellent. Some other datapoints, rummaging through the report and Google’s June 10Q:

    - Search revenues were up 24%
    - Google’s US revenues were up 28%
    - Display ads were up 15%
    - Video ads accounted for $245mm out of the $601mm increase in display ads

    Thanks for the post.

  • http://www.jordankasteler.com/utah-seo-pro-blog/ Utah SEO Pro

    As the recession kicks in more and more I think more people are turning to online marketing.

    Utah SEO Pro’s last blog post..Link Metrics for SEO

  • http://www.brickmarketing.com Nick Stamoulis

    This is awesome news when everything else is failing :) Good to see something positive these days…

  • http://www.zurpit.com Zurpit

    Its good to see that online advertising is growing while everything else is going down at least one thing is positive

  • http://www.jaseemumer.com Jaseem Umer

    Some one should say “online advertising rocks”.

  • http://www.greatpriceshere.com Nicole Price

    So do I. Journalists often do not know how to start and more often, how to end, their stories.

    Nicole Price’s last blog post..Discount Lingerie

  • http://checkpagerank.ws Check Page Rank

    Based on the current situation with the world global economy I would suggest this(the growth) won’t last long.