It's not just traditional mass media advertising that is being affected by the economy. It turns out that Web advertising is beginning to show signs of economic woes as well, but make no mistake about it, Digital Marketing is still growing and people are still spending money getting their brands online.
Does that confuse you? It should not.
Advertising is only one sub-set of Marketing. It's not the entire Marketing sector (at all).
AdWeek reported a couple of days ago that even though Internet advertising is still going to grow this year, it is showing signs of slowing down:
"The Interactive Advertising Bureau released its fourth-quarter and full-year U.S. online ad spending report for 2008, which showed the overall industry growing 11 percent for the year to reach $23.4 billion. The effect of the economy, however, was clear in Q4, when the $6.1 billion of ad spending, while marking the highest level yet recorded, represented a year-over-year increase of 2.6 percent. The 4.6 percent sequential quarterly spending growth was the lowest since 2002."
The keywords in this quote from the news item titled, Web Ad Growth Deteriorates, are "ad spending." Brands are definitely watching their ad spends with much more scrutiny, but it's very important to remember that advertising and media buys are only a small portion of the overall Digital Marketing industry. According to this report, "search revenue accounted for 46 percent of 2008 fourth-quarter revenues, up from the 42 percent reported in 2007. Display Banner advertising, the second largest format, accounted for 21 percent, followed by Classifieds (13 percent), Lead Generation (7 percent) and Rich Media (7 percent) of 2008 fourth-quarter revenues."
The report does not account for email marketing, affiliate marketing, the ROI of creating (or being engaged in) some of the more conversational (or Social Media) channels, etc... It also does not include what companies are putting into their websites, micro-sites or even more experimental channels like iPhone apps, contest, etc... It is only about the online advertising spend.
If traditional advertising is taking a hit (and it is), it's only natural that online advertising feels some of that pain, because - for the most part - those big, massive media buys are being managed by the same media companies or their interactive arms.
To really see what's happening in the Digital Marketing space, it would be interesting to know if companies are also slowing down in their overall online initiatives, and not just the advertising dollars.