Internet Advertising Revenues in Q3 '08 at Nearly $5.9 Billion >> IAB

“a weakening economy will continue to be a challenge to all forms of advertising-supported media. However, the Internet should be better poised to withstand the storm given its ability to combine performance-based advertising along with broad-based branding.” - David Silverman, a partner at PricewaterhouseCoopers LLP

Following my previous post on the record ad sales in China's CCTV, here is an official report that Online Advertising revenues are weakening. The report published collaboratively between IAB and PWC reports revenues reaching $5.9Bn in 3Q08 amidst the economic turmoil. Yet, this figure does little to bring comfort to the anticipated onslaught ahead. QoQ growth figures show that figures are up 2 percent from 2Q08, but growth in itself is evidently slowing, and there is no guarantee where it'll go in Q4. Nick Denton of Gawker Media thinks it'll cliff off with a 40% plunge in advertising spending in the foreseeable future.

I hate being pessimistic, but lets face it. Growth rates will certainly have to slowdown to reflect the state of the economy. But it is certainly no cause for despair. I'd rather approach this downturn as an opportunity for businesses to finetune their offering and operations, streamlining themselves for better efficiency. There is still money in it for Value-for-money advertising methods, as advertisers look to maximise their dollar. With the plethora of ad networks out there, few are truly targeted and scientific in their measurement methods. This will be the crunch where advertisers seek the most effective media to spend that last dollar they have in their pockets. And this is time for change for the ad networks and other online ad technologies out there.

-----------------------------------------------------
Internet Advertising Revenues in Q3 '08 at Nearly $5.9 Billion: "November 20, 2008
Internet Advertising Revenues in Q3 '08 at Nearly $5.9 Billion

11% Increase from Q3 '07, Up Slightly from Q2 '08 Despite U.S. Economic Woes

NEW YORK, NY (November 20, 2008) — The Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers LLP (PwC) today announced that Internet advertising revenues reached almost $5.9 billion for the third quarter of 2008, representing an 11 percent increase over the same period in 2007. While double-digit annual growth continues, the quarter-to-quarter curve remains relatively flat compared to recent past performance. The Q3 2008 figures, published in the IAB Internet Advertising Revenue Report, are 2 percent higher than the Q2 2008 results. Set against strong economic headwinds in the U.S. economy, Q3 '08’s $5.9 billion represents nonetheless the second-highest quarter results ever. For the first nine months of 2008, revenues totaled $17.3 billion, up from $15.2 billion in the same period a year ago and surpassing the record set in the first nine months of 2007 by nearly 14 percent.

The growth of interactive advertising that we’ve been experiencing over the past few years has stabilized due in large part to the difficult current economic climate,” said Randall Rothenberg, President and CEO of the IAB. “Interactive advertising continues to be the most measurable and cost-effective way to reach consumers, and we see more and more marketers seeking to harness its power.”

David Silverman, a partner at PricewaterhouseCoopers LLP, added that, “a weakening economy will continue to be a challenge to all forms of advertising-supported media. However, the Internet should be better poised to withstand the storm given its ability to combine performance-based advertising along with broad-based branding.”

Quarterly $ Revenue Growth Comparison – 2000-2008 YTD

Source: PwC/IAB Internet Advertising Revenue Report (www.iab.net)