It's a chain reaction. In the last few days, three different researchers came out with different ad spending projections for the next few months and it's beginning to get confusing.
Last week
it was Bob Coen, who dramatically downgraded his 2001 projections for several media from his original December forecast.
Coen now predicts a growth rate of 2.5% for the full year 2001 - that
translates into $249.8 billion that will be spent on advertising this year, compared with $243 billion last year. That also means ad spending growth will slow down to its lowest level since the
recession of 1991.
Coen's revised numbers were surprisingly similar to those of Jack Myers of Myers Reports, who in May predicted an overall decline in media spending of 1.5% for 2001, and an
increase of 0.2% in 2002.
After hearing Coen's projections, Jack Myers stuck to his guns, saying yesterday that Myers will not be revising their May media spending forecasts. While it may at
first seem that Myers is more pessimistic than Coen, it should be noted that Coen includes direct marketing revenues in his forecasts, and Myers does not, so without direct marketing growth, Coen's
adjusted forecast for 2001 would be a growth of 1%.
The bottom line is: Don't expect the next year and a half to bring the media industry back to the growth rates of years past. And that goes
for both traditional and especially online media.
The good news is that someone finally impressed the above notion upon the ever-optimistic analysts at Jupiter, who for many months have been
cheerleading us into overestimating everything. Finally, as Reuters reported from the advertising industry's annual get together in France yesterday, Jupiter said that market woes led it to cut
online advertising growth forecasts this year to 12% in global spending compared with the previous estimate of 47%.
Still, to leave off on a positive note, Jupiter said the online advertising
market would nevertheless explode to 29 billion euros in five years from an estimated 9.1 billion this year, raising its share of total advertising to 5.2% from 2.1%.
Are these numbers likely
to come in handy in your real world client meeting tomorrow? Probably not. But it's nice to know what to expect, isn't it?
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