The IAB reckons that UK revenues from online display ads — including video — grew by 16.3% YOY in 1H08. Add faster-growing online classfieds and search into the equation and the overall YOY growth rate for digital advertising emerges at 21%.
Good, eh? At the Guardian, a relatively breezy write-up by Mark Sweney carries the IAB’s suggestion that internet ad spend is “propping up” traditional media. (Ah, bless).
Sweney’s piece also includes the following quote from Dan Clays, who runs the digital ad agency BLM Quantum:
“What we saw in the first half was advertisers continuing the trend of shifting ad money into online from other mediums.”
This all sounds rather different from the grim prognosis offered up by Enders Analysis a few weeks ago.
But the IAB has a vested interest in well-positioned boosterism. And unlike Enders, it doesn’t issue forecasts.
Interestingly, however, the IAB does take a stab at telling who is spending how much online. Here, then, are the sectors that accounted for the biggest slices of online display spending during 1H08.
Technology — 17.3%
Finance — 11.9%
Entertainment & media — 10.7%
Recruitment — 9.9%
The technology industry is in the process of falling to earth. Much of its ad spend originates with US-based companies who have started to suffer because of the dollar’s revival against other currencies.
The finance industry? Enough said. Ditto recruitment. That leaves the oddball category of “entertainment and media” as a potential source of strength in online display. (Here’s to a long autumn of blockbuster Hollywood productions.)
Guy Phillipson of the IAB might be right about the “incredible increase” in digital ads that “propped up” traditional media during 1H08.
But there’s a significant risk that the second half of 2008 will be notable for something else — namely, the giants of paid search (Google et al) sucking revenues out of the online display market.
This will happen as marketing directors start to scrutinize every last cent of expenditure for its ability to generate a return on investment.
Of course, there will be only one way for online display to replace that lost revenue — by sucking revenues out of print.
If you thought that the transition from print to digital was already occurring rapidly, what lies in store during the next year or two may upend your expectations entirely.
We could very easily end up compressing five to 10 years’ worth of transition into a year or two of frenetic restructuring. Fast evolution will suddenly become revolution.
Whatever emerges, it won’t resemble your dad’s idea of media.