According to new report by Barclays, Domestic ad spending is expected to drop 10% next year, worse than the declines felt in both the 1991 and 2001 recessions.
The 10% figure comes a little over two months after Barclays pegged next year’s decline at the considerably lesser 5.5%.
Barclays said in 2010, spending should increase 1%.
The 1991 recession caused a 1.9% decline, while the 2001 slowdown brought a 6.2% decrease.
Barclays’ now predicts that the decline next year, will be far greater than what occurred in the aftermath of 9/11.
Barclay’s report predicted that local spending would fall by 12.2%, while national advertising would drop 8.4%.
Barclay’s forecasts that local ads will decline an additional 1.4% in 2010.
However the good news from the report is that Internet advertising should increase 6.1% in 2009 and another 12% in 2010.
Internet advertising (display, search, lead generation, etc.) would still just account for 0% of all ad spending next year, so the online ad section has a lot of upside.
The predictions for tradtional media were not a good.
Barclays forecasts that:
Local TV stations will experience declines of 15.5% and 1.1% in 2009 and 2010, respectively
Newspapers will fall 17% and 7.5%, and radio will drop 13% and 1.7%.
Cable TV ads revenue to fall 3% in 2009, but increase 5% in 2010.
In another report, media economist Jack Myers predicted an “advertising depression.”
Myers, a longtime industry consultant who runs JackMyers.com, is now forecasting an unprecedented three straight years of declines in advertising and marketing spending in the U.S. starting this year.
It projects an overall decline in total marketing budgets from 2008 through 2010 for the first time since the Great Depression.
“”””We are witnessing epic changes in the ways in which people approach how they move around and how they allocate their budgets, especially with respect to discretionary spending and their attitudes toward debt,” Merrill Lynch economist David Rosenberg said in a recent report. “We are convinced that historians will label the environment we are in today as something different from a garden-variety recession.”
The online spending will go up worldwide.
Maybe some Company’s do not manage their finances the way they should when it comes to online marketing.
A man can fail many times, but he isn’t a failure until he gives up.
I follow the media industry very closely, and its never a day or two before you see yet another big media company or agency retrenching staff.
For example,the Omnicom group just announced a 3,500 cut in staff worldwide. That’s HUGE.
Many of these people are highly creative and talented. Perhaps this displaced resource can be chaneled to help domainers with their thousands of parked storefronts to bring in revenue through affiliate marketing deals or even creating content that can be sponsored. Theae people have the kind of contacts to the various industries that domainers will never have.
As Albert Eienstein said, ” in the middle of difficulty, lies opportunity’.
Even a just a year ago, we had a hard time recruiting talent and everyone was demanding funny money to move. Its funny how fast things can change literally overnight.