More Good Tidings for Online Marketing in 2003

With the long slide in the ad industry seemingly coming to a halt, a flurry of new forecasts have painted a fairly rosy picture for online marketing and advertising in 2003.

The Interactive Advertising Bureau (IAB) and eMarketer issued a report Wednesday that pegged the online advertising industry consensus for next year’s growth at 6.3 percent, outstripping the 4.3 percent growth predicted for total media spending. The study examined 10 forecasts, finding six predicting growth between 4.5 percent and 5.3 percent.

The positive trends were buttressed by findings from a study by Paris-based communications firm Havas and the London Business School, which predicted interactive marketing would grow 11.3 percent next year, far outstripping total spending growth of 3.3 percent. Calling interactive “the main winner,” the report said much of the gains came at the expense of traditional media expenditures.

“We’re experiencing a vital turnaround here,” said Greg Stuart, the IAB’s president and chief executive.

A number of forecasters have predicted that the online marketing industry has turned the corner and will return to solid growth next year, as the economy improves and traditional marketers begin to shift more spending online. In recent weeks, a variety of publishers –such as Yahoo!,, and the online units of the The New York Times and The Washington Post — have come out with bullish reports on their online advertising revenues.

eMarketer blamed online advertising’s two-year slump on the usual suspects: a sluggish economy; the dot-com crash; advertisers abandoning huge portal deals; and the industry’s confusing number of formats and performance metrics.

With those problems either entirely or mostly ironed out, the researcher said the industry returned to growth in the fourth quarter and carry that through to next year.

Interactive marketing giant DoubleClick’s fall marketing survey backed up the positive trends. The survey found a slim majority of marketers expecting bigger budgets in 2003, with e-mail and online marketing gaining a higher profile on their priority list. Fifty-seven percent said they would likely increase spending on e-mail marketing next year. Respondents using online advertising for branding increased from 75 percent in the spring to 82 percent in the fall.

The London Business School study found that the United States, United Kingdom and France were the key drivers of interactive marketing’s global growth. The study forecasts 12.7 percent growth next year in the U.S. market, 23.3 percent in the UK, and 14.2 percent in France. Survey respondents cited online marketing’s cost-effectiveness and accountability as two reasons for increasing their spending in the area.

DoubleClick’s survey had slightly different results, with its respondents expressing continued concern about the effectiveness and measurability of online advertising. Fewer than half said they had measurement tools, a majority still relied on click-throughs, and a third said they were unsure of its effectiveness.

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