Internet advertising revenue in the U.S. dropped five percent to $5.5 billion during the first quarter, reports PricewaterhouseCoopers and the Interactive Advertising Bureau (IAB).
However, several researchers covering the U.S. advertising market say Internet ad spending has been performing remarkably well in a challenging economic environment, even as the ad revenues generated by conventional print publications have crashed and burned.
“Current economic conditions are clearly challenging,” said PricewaterhouseCoopers partner David Silverman. “Nonetheless, interactive media continues to consume a larger piece of the overall advertising pie.”
Healthy By Comparison
A new report from Nielsen quantifies just how much better online sales are doing in comparison with other media. U.S. ad spending overall fell 12 percent year over year to $27.9 billion in the first quarter, with national print publications among the biggest revenue losers.
Print media ad sales fell 27.7 percent at national newspapers and were down 20.6 percent at the nation’s magazines, Nielson reports. Syndicated TV ad spending fell 18.8 percent in the same period, though network TV ad sales were down only 4.8 percent.
“These first-quarter results will hardly come as a surprise to an advertising industry that’s struggling just like many other areas of the American economy,” said Nielsen Vice President Annie Touliatos. “Now more than ever, it’s important for buyers and sellers to adjust to the changing competitive landscape.”
By contrast, Internet ad spending fared significantly better than other media categories. According to Nielsen, online ad sales declined a comparatively modest 3.4 percent in the first quarter.
IAB Chief Executive Randall Rothenberg expressed confidence that interactive ad revenue growth will resume as the U.S. economic climate improves. “Interactive advertising is the most accountable way to reach consumers — and in this economy, digital media will be a core component of any successful marketing campaign,” Rothenberg said.
With Adversity Comes Opportunity
Forrester Research analysts say most…