Search and Banners Lead Digital Ad Rebound

By Steve Smith

Several analysts appear to be getting bullish again on emedia as the digital segment recorded some record quarterly ad spending gains and Yahoo and Google crowed about the return to growth. Researcher eMarketer has weighed in with a more specific forecast on where the ad spend is likely to head in 2010 and beyond. Search will continue to advance, even as the market matures, with an 15.7% gain to $12.4 billion in 2010. Meanwhile banners will enjoy a hearty 8.2% expansion. Lead generation will spring back from a 13.8% drop in 2009 to a 5.5% rebound in 2010. But still enjoying the greatest rate of growth will be video advertising, expected to rise 48.1% this year. Overall, eMarketer now expects ad spending this year to hit $25.1 billion up 11% from 2009 and double the rate of growth eMarketer had predicted in earlier forecasts.

Despite conventional wisdom that advertisers responded to the recession by eschewing brand campaigns for the immediate returns of direct marketing, a new Razorfish report finds otherwise. In their survey of clients, 70% kept their media spending mix about the same in 2009 as it had been the year before. “In general, our clients did not change their tactics,” the report says. “Interestingly, of those that did shift tactics, 40% moved to a heavier focus in direct response, while 60% actually shifted to more brand-focused marketing.” Razorfish joins eMarketer and other analysts in anticipating a great investment in combined branding/DM approaches. A number of recent studies have shown that online brand campaigns help raise awareness so that paid and unpaid search investments prove more effectives. The company says that in 2009 49% of their media spend was focused on impression-based (CPM) media, while only 36% when to performance (CPC) buys.

Razorfish says that in an effort to preserve display ad pricing and control data more publishers will create premium inventory and decrease their reliance on non-guaranteed ad networks. “With more dollars going into digital, publishers will try to take more control over their inventory, and in a revived economy we expect prices to rise this year,” the report states.The full Razorfish 2010 Outlook is available online.