More NewsSlower Growth for Web Ad Spend in 2005

Slower Growth for Web Ad Spend in 2005

After two years of double digit growth, Internet ad spending will rise at a more modest pace in 2005, according to TNS.

Online ad expenditures this year will rise by 7.6 percent, while total ad spending exhibits a moderate 3.4 percent growth to $145 billion, according to TNS Media Intelligence.

After two years of double digit growth, the anticipated rise in Internet expenditures is a more modest advance for the medium, though it’s still well above the growth forecast for all media. “To increase [the Internet spending] on a double digit basis every year becomes more difficult,” TNS CEO Steven Fredericks told ClickZ News.

Other sectors experiencing big increases are cable TV (11.6 percent), Hispanic media (10.5 percent), and consumer and Sunday magazines (7.5 percent). TNS said expenditures will shrink for spot TV (-6.4 percent), B2B magazines (-.9 percent) and radio (-.1).

The firm expects total ad spending in the third quarter to slow to 0.7 percent growth, then rebound to 4.5 percent in the fourth quarter. Fredericks attributed the year-over-year dip to spending on last year’s Summer Olympics and Presidential election.

“We believe that the rate of growth will improve during the fourth quarter as advertisers confidence in the economy stabilizes and consumer spending continues to expand,” he said.

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