NOV 2008 - NZ Online Advertising Defies Global Economic Downturn
All categories of online advertising continued strong year-on-year growth according to the quarterly IAB Insight report – covering Q3, 2008 – which was released by the Interactive Advertising Bureau of New Zealand and PricewaterhouseCoopers today.
Despite a tightening economy, total online advertising was up 22.3% on the same quarter last year, and all categories showed double-digit growth on Q3 last year.
“Online advertising spend has experienced strong growth in 2008, particularly when considered in the context of recent economic conditions. This is indicative of the appeal of interactive advertising, where advertisers have the ability to quickly gauge the market response and act accordingly,” says Chris Perree, Partner at PricewaterhouseCoopers.
Search & Directories advertising increased most significantly, up 34.4% on Q3, 2007. But Display (up 24.0%) and Classified (up 14.0%) also showed strong increases.
Mark Evans, CEO of IAB, says there’s evidence to suggest that the economic downturn might actually increase interactive advertising’s marketshare.
“Internationally, indications are that the economic downturn is actually resulting in the shifting of more advertising budget online. Online advertising provides greater measurability for response-driven advertising, faster response, and the ability to tweak and tune campaigns easily,” says Evans.
Evans says if New Zealand follows overseas trends, he expects Search & Directories advertising, in particular, will benefit from the economic downturn. “When times are tough, companies are single-mindedly focused on generating sales”, he says, “and this tends to drive up demand for paid search campaigns that deliver leads through the door.”
However, locally Display advertising showed a strong quarter-on-quarter growth this quarter, up 5.5% on Q2, 2008, which Evans suggests is a sign that marketers are starting to move more of their brand advertising budgets online as well.
“Online advertising’s reach gives advertisers a cost-effective channel to deliver brand messages to their audiences in a way that is new and engaging. And advertisers are increasingly turning on to the interactive nature of online advertising,” he says.
Evans says locally trends are mirroring those seen overseas. “Year-on-year growth continues at pace in New Zealand. This quarter things have slowed a little from the type of hockey-stick growth curves we’ve been seeing as people stand back and take stock of what’s happening globally, but we’re still expecting strong growth to continue into next year and beyond.”
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