In early 2001, the economy was roaring. There was no stopping it, or so many people thought. Then, the market tanked and stocks came spiraling downwards. I saw advertisers dramatically slow down their ad spending on many web sites, including our http://www.morebusiness.com small business portal. In the months that followed, the country saw the onset of a recession. Within a year, online ad spending had dropped dramatically and the economy was seeing signs of pain, except for real estate.
Here we are about six years later. Real estate’s now got the pain and overall ad spending is down 0.3% compared to the same period last year according to a new report by TNS Media Intelligence. “For the first time since 2001, media advertising expenditures have declined for two consecutive quarters,” said Steven Fredericks, TNS president and CEO. “While the protracted downturn in automotive spending has been a prime contributor, the overall results reflect weakness across a wide range of industries and advertisers. Given the uncertainties about near-term economic growth and consumer spending, we expect core ad spending will continue to face challenges during the second half of the year.”
More so, the country’s largest CEO group, Vistage (of which I am a member), reports that CEO confidence in the economy is at an all time low. According to the report, in Q3 2007, the Vistage CEO Confidence Index fell to 81.4, the lowest it has been since the survey began in 2003.
Is this 2001 all over again? I don’t think so, especially if you conduct business online. TNS’s report shows ad spending down in most industries except a few. Online ad spending is actually up a whopping 17.7%! In other words, while advertisers are spending less money overall, they are transitioning parts of their budget from traditional media to the Internet. So if you have an Internet component to your business, my hunch is that you have a better chance of surviving the rocky roads predicted ahead.