Nieman Foundation at Harvard
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Nov. 6, 2008, 1:25 p.m.

Lots of gloom for ’09 local online ads

Borrell Associates has released its outlook for local online advertising in 2009, and as you might imagine, the picture is not particularly pretty. Here’s the executive summary; the full report costs big bucks. Some highlights:

— “For local interactive media, the big ad slowdown has begun a year earlier than we anticipated.” After a 47 percent increase in 2008, they’re projecting only a 7.8 percent increase in 2009.

— But Borrell projects declines in the most traditional forms of online advertising: banner ads, pop-ups, and other display formats. The increase will be in email advertising, search advertising, and video. Which would explain why the push for video on news sites over the past year or two shows few signs of abating — at least on the business end. Unfortunately, search advertising is a tough business for news orgs to get into.

— And these changes aren’t temporary: “2009 will be the first year since the start of the century in which some components of interactive advertising show little or no growth, or may even decline. The changes foreseen are not cyclical, and show no sign of improving during forthcoming years, irrespective of upward movement in the nation’s economy. No form of advertising yet invented has
grown forever. Interactive ad spending is no different.”

If they’re right, news companies can expect to see not only a secular decline in their print advertising — they can expect the same online, in most of their current formats.

POSTED     Nov. 6, 2008, 1:25 p.m.
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