Summary:

Another day, another ad spend report telling non-traditional media not to worry about a recession: PQ Media says its data indicates that alt…

Another day, another ad spend report telling non-traditional media not to worry about a recession: PQ Media says its data indicates that alternative and digital media can expect strong growth in 2008, despite an economic slowdown in the U.S. Specifically, PQ says total spending on alternative media – including expenditures on online/mobile, entertainment, and digital out-of-home – is forecast to grow 20.2 percent to $88.24 billion in 2008. Furthermore, that category will post a compound annual growth rate (CAGR) of 17.0 percent between 2007 and 2012, hitting $160.82 billion.

Keeping in mind that PQ Media tends to lump individual segments together, the findings are in line with other recent projections from TNS Media Intelligence, which in January forecast that display ad revenues would be up 14 percent this year (a relatively lower growth rate than its 2007 tally of 15.9 percent), and last week’s prediction by eMarketer that online spending in 2008 would rise 23 percent (slightly lower than the researcher’s finding that growth was 24.9 percent last year). A breakdown of the findings in the PQ Media Alternative Media Forecast: 2008-2012 after the jump.

– Spending on alternative advertising, which PQ classifies as online/mobile advertising and entertainment and digital out-of-home advertising – climbed 25.8 percent to $39.22 billion in 2007, and grew at a CAGR of 26.2 percent from 2002-2007 period. Alternative advertising represented 17.7 percent of overall ad spend in 2007, up from a 7.0 percent share in 2002.

– Taking a closer look at online and mobile advertising – which includes search and lead generation, online classifieds and displays, e-media, online video and rich media, internet yellow pages and consumer-generated ads – spending jumped 29.1 percent to $29.94 billion in 2007. That collective category also experienced CAGR of 31.4 percent from 2002 to 2007. And while PQ’s forecast serves as a balm for alternative media, its research provides more angst for traditional media, as the former’s growth was driven was driven by a direct shift away from the latter.

– Spending on entertainment and digital out-of-home ads – namely, local pay TV, digital out-of-home media, video-on-demand, interactive TV and DVR advertising, video game and home video, and satellite radio – gained 16.2 percent to $9.28 billion in 2007, and climbed at a CAGR of 15.0 percent from 2002 to 2007. The growth there was fueled by new ad insertion technologies, the pursuit of new ad platforms that reach young audiences. PQ also cited the steady growth of local pay TV, satellite radio, DVR use.

– Alternative marketing, including branded entertainment and interactive marketing, rose 17.9 percent to $34.21 billion in 2007, and posted a CAGR of 17.5 percent in the 2002-2007 period. Alternative marketing represented 14.5 percent of total marketing spend in 2007, up from 8.7 percent in 2002.

Methodology: In coming to these conclusions, PQ Media says it researched, surveyed and/or consulted with almost 10,000 traditional and alternative media companies for input regarding size, scope, trends and growth of the alternative media industry. Additionally, it claimed to have examined thousands of public and private documents from more than 2,500 unspecified sources. More details about PQ’s methods are here.

The press release is here, while a free emailed summary can be accessed by filling out a form here.

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