Notwithstanding the online advertising�s good performance along with heavy expenditure prediction due to the coming Olympics and US Presidential elections, the United States� advertising market will not turn out any extraordinary result next year, predicts Universal McCann, a division of Interpublic Group in its latest report.
The report prepared by Robert Coen, director of forecasting at Universal further envisages that advertising spending in US will increase by only 3.7% next year. In 2007, the industry grew only by 0.7% over last year, while broadly US economy was back on track with 4.7% average. Advertising, as industry thus, is trailing the growth of the broader economy.
US media companies are worried. Threats from digital technologies are looming large over traditional advertising models. Add to that other precarious reasons like housing bubble, rising oil price and a possible economic slowdown.
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Monday, January 28, 2008
US advertising forecast for 2008 is not looking bright
Ad slowdown: Google has plans ready for long term
Advertising executives may be a worried lot following threats of domestic advertising spending going down across US in 2008, but Google ad managers seem least bothered about the probable slowdown even though Google�s 99% revenue comes from its advertising wings.
While speaking at a UBS media event in New York, Tim Armstrong, Google�s sales chief looked quite indifferent when asked by media people whether the possible slowdown will hit Google adversely especially when it has serious plans for buying and selling ads for TV, radio and print medium.
Why Google seems least bothered about short term predictions because it has long term strategy in store. Quoting him, “This is a two-, three-, five-year product we’re going to work on� Search really took us two-and-a-half years to get up and running on a large level. These may take us a little longer, because they’re bigger businesses with more history behind them.”
And why Google should be worried about the possible ad slowdown. Isn�t it diversifying also into anything that is internet related? We have seen in last month while posing threat to Facebook it has extended its base into cell phone arena.
So aggressive Google towards its expansion that now it is looking beyond Doubleclick and reportedly is planning an integrated ad selling platform for all the media. The venture may take up to five years.
Its obvious why Google is not as bothered as major newspapers and magazines over the US ad slowdown.
