Other Trends to Watch in 2008: Advertising Recession Not To Hurt Internet and Digital Signage?

December 28th, 2007 Nurlan Urazbaev

Analysts at Yahoo Finance and MediaPost’s Search Insider predict a slowdown in ad spending on traditional media. Both observers, however, are confident that the recession will not affect online advertising, which has been expanding healthily in 2007.

While traditional media is hurt by such factors as the general economic slump, the housing crisis, the writers’ strike and continuing fragmentation of its declining audience, “… the explosive growth of ad networks—firms that place advertising on websites—will make it easier for advertisers to spend money on the internet,” says the author of Five Media Trends in 2008.

According to Mark Simon of Search Insider: “Projections for overall online ad spend for 2008 remain rosy, even as every leading macroeconomic indicator points to a recession ahead. Finance alone makes up 33% of the overall $275 billion online ad spending pie (according to eMarketer.com). You can’t tell me that this sector can take a huge hit without having a big impact on both the search and display market. But online media remains so cheap that the bulk of any spending pullback will hit other channels harder, including offline and high CPM online media.”

What about digital signage? If we sum up the trends we covered in our previous posts (see the Big Picture category), we’ll see that:

- In-store media (shopper marketing) is growing faster than the Internet

- Outdoor advertising is growing almost as fast as the Internet and will be further boosted by the recent US legislation permitting digital billboards

- US consumers are spending twice as much time away from home than they did 30 years ago, and the average daily commute has doubled to about an hour

- The traditional media ad budgets started to be diverted to digital signage ad space even without waiting for the standardized metrics

- Standards and metrics for out-of-home video (aka digital signage) networks are being developed by big players such as Nielsen, Arbitron, POPAI, OVAB and others…

- Many retail chains are trying to reduce the static ad clutter by re-engineering store interiors and letting digital screens in

- There is an explosive increase in inquiries about digital signage from advertisers, media buyers, agencies and retailers

- New trade shows and portals dedicated to digital signage are popping up almost every month

- There is a steep rise in mergers, acquisitions and IPOs in the field of digital signage

All of the above factors make me believe that the digital signage trade will not be in trouble in 2008, and most probably will continue to advance, filling the void left by traditional media.

On this high note I wish everyone a great New Year and I will return from vacation on January 09.

Entry Filed under: Digital Signage ROI, The Big Picture, Uncategorized