Despite Recession, US Online Ad Spending Continues to Rise

    April 8, 2009
    Chris Crum

Research shows that marketers are spending more on online advertising and less on ads in newspapers, magazines, and radio. According to eMarketer, each year, ad spending on online media is growing by at least a percentage point.

eMarketer also projects that online ad dollars will jump about 5% by 2013. Here’s how they see it playing out:

The current rising trend comes even as the recession casts a shadow over the industry. eMarketer suggests that the economic downturn may actually speed up the transition to digital advertising for many marketers.

"The spending shifts predate the recession," says David Hallerman, eMarketer senior analyst. "But the current economy is reinforcing the new advertising models—and making them more permanent."

"Digital marketing offers compelling benefits, especially for cash-conscious companies," he continues. "Marketers can more readily measure the results of Internet advertising than with most traditional media. This produces more-efficient advertising and higher ROI, which in turn pushes traditional media to compete with lower pricing."

eMarketer says this puts more pressure on traditional media’s bottom line. They talk about how advertising that consumers welcome (targeted, relevant ads) is becoming the way it is done.

Interestingly, a different report from McPheters & Company recently indicated that TV/Magazine ads were more effective than online ads. This is why online ads need to be more engaging.

Now more than ever, every ad dollar counts, and the amount of targeting and relevancy opportunities online is very great. Advertisers need to make sure they are creating ads that consumers want to interact with. That often means thinking outside the box, and can include elements like video and social media.