The financial mess we’re facing will have lots of consequences for the ad industry. BusinessWeek takes a look at a slowdown affecting one of the hotter sectors in the biz: online advertising.
Even before the financial market malaise took a turn for the worse with the bankruptcy of Lehman Brothers, Bank of America’s (BAC) purchase of Merrill Lynch (MER), and the government bailout of AIG (AIG), researchers were cutting back online advertising forecasts. In August, research firm eMarketer cut projections for Internet ad spending this year to $24.9 billion, the second revision of estimates first released in October. The firm expects Internet advertising growth to slow to 17.4% this year fom 25.6% in 2007. Next year, growth will slow even more, to 14.5%. “Online advertising will not grow as fast because of the economic problems,” eMarketer senior analyst David Hallerman says.
My clients are nervous all around. Are yours?