Forecasted Online Ad Spend Is Corrected Upwards

Search is winning the hearts and minds of marketing managers across the US, (and this is good news for search worldwide). Brand managers that tend to buy display advertising more readily will continue to be a tough sell for search, but that may be its only limitation.

TNS Media Intelligence (which tracks online display advertising spend) has increased their forecast for 2006. This is a 4% correction from their earlier estimated growth, (and bucks the hold pattern or downward trend for other forms of advertising). The company cited earlier estimates as far too conservative after tracking faster than expected migration to the online space from traditional media. Online ad spend growth was 19.4% last first quarter, and is projected to continue to grow by 13% and reach a whopping 12% of total advertising spend in 2006. This figure is far higher than ever reported before.

Factoring search into the online advertising spend is what’s responsible for this correction and several comments make this point clear. Search is not officially tracked by the company but was factored in using IAB numbers. Although I think it a generous figure, search is cited as adding an additional 50% to the tracked online spend and forecast for 2006. The health of online ad spending, (and search marketing especially), in the post-bubble online advertising era is unmistakable.

There are more quotes at Media Post.

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