Online Ad Market Close to Bottoming Out?

By: Mike Shields/Mediaweek The online ad market is close to bottoming out, according to new report issued by industry tracker eMarketer.

The research firm, which amalgamates spending reports from multiple sources to produce its own forecasts for the digital space, predicts that spending will continue to decline for the second half of 2009, but that decline should decelerate.

eMarketer is basing that assessment in large part of the online ad spending figures released earlier this week by the Interactive Advertising Bureau and PricewaterhouseCoopers, which found that total revenue had slid by 5.3 percent year over year to $10.9 billion.

However, the fact that the much-maligned display ad market had only declined by one percent during the first six months of the year has actually fueled some optimism for the remainder of 2009. eMarketer called that mild decline ?a surprise.?

Thus, ?while our preliminary estimates point to another decline in the year?s second half, expect that to be less than the first half?s 5.3 percent drop,? wrote analyst David Hallerman in the report.

Hallerman also predicted that online ad networks?which many had expected to suffer as the economy went south?should continue to thrive in the second half of the year, particularly as more and more online spending is geared toward direct response tactics.

?For advertisers, the relatively lower costs of banners bought through networks has continued to attract significant budget shares,? he said. ?For publishers, the competition for ad dollars has only accelerated, with more and more pages and visitors across the Internet.?

-- Nielsen Business Media