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UK Net Will Weather Ad Storm, Except In Financial Services: Forecast

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With the gloomy economy really beginning to bite advertising sales (see Trinity, ITV (LSE: ITV) earnings amongst others), the question for many of us is – how well will the web survive the downturn? While MD Rob Grimshaw in May forecast a continued “big flood of money coming out of traditional media” on to a buoyant web, regardless of downturn, French publisher Hi-Media observed an “online advertising market slowdown”…

Running the numbers, the World Advertising Research Centre (WARC) reinforces the hubris, asserting “the internet can confidently be predicted to grow throughout the predicted downturn”, growing 17.6 percent this year and 12 percent next: “Even if these figures prove optimistic, there still seems plenty of room for expansion of the medium.”

WARC reckons UK ads spent for consumables (food, drink, household goods) will dip 1.8 percent next year – but the web will be alone in growing its earnings from this category. While the likes of TV and cinema are forecast to be losers in just about every form of advertising, the net is predicted to be a gainer, except in financial services advertising, which gives it 26 percent of its income…

“The internet is well positioned to gain share from these rival media, particularly in sectors where it is currently under-used as a medium. But even it will not escape some fallout if financial and retail advertisers cut their budgets for extended periods.”