Tuesday, December 4, 2007

Coen annual projections point to continued growth in online, averting ad recession.

Robert J. Coen is out with his annual forecast for ad spending, reported here in the NYTimes. Here are some highlights:

The standout medium by far, in Mr. Coen’s forecast, is the Internet, where ad spending this year will rise 20 percent from 2006. By comparison, he estimated there would be declines this year in ad spending for media like local newspapers, down 8 percent; national syndicated television, down 8 percent; and local radio, down 6 percent.

An increase this year of 0.7 percent in total American ad spending would represent the smallest yearly gain since the industry recovered from its 2001 recession. Those increases have ranged from 2.4 percent in 2002 to 7.4 percent in 2004; the increase in 2006 from 2005 was 3.9 percent.

An increase of 0.7 percent would also mean that ad spending as a percentage of American gross domestic product would decline in 2007 to a weak 2.05 percent, from 2.14 percent in 2006.

Still, “we don’t think there will be a recession” for Madison Avenue, Mr. Coen said in his presentation. “But advertising is being crunched down.”

Again, the Internet is the bright spot for American media performance. Online ad revenue expected to climb 29 percent in 2007 from 2006, and an additional 19 percent in 2008 from 2007.

“There is a better outlook in other parts of the world than we see in the United States,” Mr. Coen said, particularly in countries like Argentina, Brazil, China, India, Poland and Russia.

For 2007, ad spending outside the United States is expected to grow 5.7 percent from 2006, to $341.4 billion, Mr. Coen said. For 2008, ad spending overseas will increase 5.3 percent from 2007, he added, to $359.5 billion.

Mr. Coen’s totals for worldwide ad spending for 2007 are $625.3 billion, up 3.4 percent from 2006, and $653.9 billion for 2008, up 4.6 percent from 2007.

Meanwhile, over at CNET, an early warning of very real threat that online advertisers might cook their goo...er frog.

This article on CNET suggests that Facebook may actually be "grooming" consumers to accept more intrusive marketing online. This is and has been a very real concern of mine, especially as we move from desk- and laptop connections to mobile devices. The intrusiveness, if it becomes too interruptive too fast, or worse, if it betrays trust as Facebook has shown, could do serious damage to the channel, which, of course, has already deconstructed the old mass system. Then what? Dining on leftover frog legs?

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