The report, "Media Recession 2001: Real of Self-Fulfilling?", predicts an ad spending rebound in the fourth quarter of this year, and states that the recent wave of dot-com failures and disappointing earnings reports are too often blamed - conveniently and erroneously - on an ad spending slowdown.
Based on proprietary research among marketers and ad agency executives, the report says that the ad community is more optimistic in its plans to spend advertising dollars over the next 12 to 18 months than they were in 1999 at the height of the media economic boom. The new Myers' Ad Confidence Index (ACI) - a composite drawn from the percentage of ad executives who either plan to increase, decrease or keep stable their ad spending plans over the next 12-18 months - rose one percent to 69.04 in 2000 from 68.37 in 1999. Myers will issue an updated ACI every quarter.
The Myers surveys show that local media - with the exception of radio - are likely to see the largest support.
Overall, Myers believes the downturn in media spending this year is likely to be followed by a continuation of long-term media industry expansion, beginning in the fourth quarter of this year.
"The downturn in the media economy is being caused by predictable and cyclical factors," said Jack Myers, chief economist, Myers Reports.
"Much of the consternation and fear of a sustained recession in the media industry is the result of overly aggressive and misinformed press reports. We believe the media economy is merely experiencing a cyclical hiccup in what will be a period of sustained economic growth."
The report states that Internet companies are reinforcing a negative public perception of the advertising marketplace "by overtly blaming an advertising slowdown for layoffs and under-performance. Instead, they should be laying the blame squarely on the shoulders of inexperienced and incompetent management and investors who created unrealistic expectations for an emerging and mostly unproven medium."
Myers projects that Internet ad spending will grow 70% in 2001, to $8.1 billion. "Wall Street and industry forecasters are braced for what most are describing as flat to marginal growth," the report states.
"But, and this is the big story, their total projected Internet ad spending for 2001 is almost exactly the same as Myers' forecast." The report points out that Myers has consistently published Internet spending statements that have represented only 50% of official industry numbers. "We have published and called attention to the disparity," the report says, "and issued warnings to the industry of the dangers of inflated spending estimates."
The report says that the "dramatic implosion" of the Internet economy over the past several months has been "a healthy purging - not of companies - but of investors and executives who have lit