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JP Morgan Predicts Display Ad Spending To Drop
By Anna Johnson on September 16th, 2008JP Morgan analyst Imran Khan had lowered his 2008 and 2009 forecasts for online display ads, forecasting that advertisers will shift more dollars away from display and to search and performance-based advertising.
According to Mr Khan, U.S. display ads will grow by 14 percent to reach $8.2 billion this year, down from his original forecast of 20 percent growth and $8.6 billion in sales. He expects display advertising in 2009 to grow by 16 percent and reach $9.4 billion, down from his earlier forecast of 17 percent and $10 billion.
Although Khan believes online advertisers will devote more of their budgets to performance-based advertising, he also predicts growth in search to also decline somewhat. He expects search advertising to grow by 27 percent in 2008, rather than the 32 percent he previously predicted. Presumably this is due to advertisers reducing their overall online budgets.
