• by Masha Geller , December 2, 2002

I don’t know why I tend to favor eMarketer over all other forecasters, but I do know that when they say things are going to get better for the online advertising market, I believe them. Maybe it’s because they don’t sugarcoat anything and actually take the time to analyze every bit of data out there. Take yesterday, for example: their just-released Interactive Marketing: Stats, Strategies and Trends report says that after two straight years of decreasing sales, US online advertising will begin recovering next year, but the recovery will be SLOW.

According to eMarketer projections, 2003 spending will rise slightly to $6.70 billion, up from $6.38 billion this year. The expected bounce-back is due to a combination of factors, researchers say, including traditional marketers devoting larger slices of their ad budgets to online advertising as well as a general easing of the economic recession. By 2005, online ad expenditures will hit $8.10 billion--still less, however, than 2000's spending of $8.23 billion.

"The last two years were a disaster for online advertising," says David Hallerman, Senior Analyst at eMarketer. "The fact that 2003 is going to be a growth year, even a small one, is good news."

As eMarketer pegged this year's growth at -11.5%, and forecasts +5% gain for next year, there is a strong and definite shift in outlook from negative to positive. Even during the downturn in online advertising spending, when six types of online ads posted losses, positive results came from three online vehicles: keyword searches, classifieds and rich media.

"The great news here, though, is the long term projection," says Hallerman. "Beyond next year, online ad spending will continue to show steady growth, going to 7.5% in 2004 and reaching a healthy 12.5% growth rate in 2005."

Do these projections really accomplish anything other than making people like me feel better about their careers? Doubt it, but it nice to know I’m not the only optimist out there.