Economy Fuels Ad Shifts From Traditional To Online

Advertising on social networks soared during the first half of the year, jumping 20% in the U.S. and 12% in the U.K., according to PwC. Those rates were above what the firm projected and are “fueling” the collective Internet advertising market, which is in one sense benefiting from the struggling economy.

Search remains strong as does mobile, with the spread of tablets and smartphones. “It appears that the weakening economy is accelerating the shift of advertising from traditional media to the Internet,” PwC wrote in an update of its sprawling media outlook for 2011-15.

Social networking is also playing a role in a buoyed TV market, with it “stimulating interest, and live viewing, in shows.”

PwC said its projections across the ad market for 2011 remain on the “conservative side” and below others. Agency Zenith, for example, now forecasts a 2.5% increase in North America overall, while PwC projects 2.2% growth.



Globally, the figures are 3.6% and 3.1%, respectively.

There are three regions, however, where the two firms diverge considerably. In Asia-Pacific, Zenith calls for 5.5% growth, while PwC is at 2.4%. PwC says strength in China and India is being dragged down by a slower Japan.

In Europe/Middle East/Africa (EMEA) and Latin America, PwC is more bullish than Zenith. PwC projects a 4.1% increase in EMEA this year, compared to Zenith at 2.9%.

In Latin America, PwC has an 8.1% projection, compared to a notably lower 4.9% at Zenith. Nonetheless, PwC says Latin America could be doing even better: “The slowdown in the U.S. economy is adversely affecting Latin America, which relies on the U.S. for its exports.”


1 comment about "Economy Fuels Ad Shifts From Traditional To Online".
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  1. Doug Garnett from Protonik, LLC, October 24, 2011 at 8:13 p.m.

    Interesting theory. What's missing is the reality we saw last year in the US - as soon as the economy had shown a pulse, those dollars have started shifting back and there have been surprising increases in traditional media.

    It's all quite complex. But this headline misleads readers. It ignore the fact that. A 20% growth in social media is far less than a .1% growth in TV.

    Just wish there a little interpretation added to this story.

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