More NewsThe Last of the Cockeyed Optimists

The Last of the Cockeyed Optimists

While most analysts are complaining about the thunderstorm, Jim Nail offers wisdom with a smile. Find out why you should join the last of the optimists.

“The pessimists here haven’t taken their ZOLOFT. The whole Internet industry is manic-depressive. Either the sky’s the limit or death is upon us, and there’s no in-between.”

The voice on the phone was bright, cheery, and delightful to hear. It belongs to Jim Nail, a senior analyst at Forrester Research in Cambridge, MA. While most analysts are complaining about the thunderstorm, Nail is enjoying the rain and looking forward to bright sunshiny days.

Nail’s my kind of fella, and he should be yours, too. His latest Forrester effort (delivered this month) is called “Online Advertising Eclipsed,” and its thesis is that U.S. digital marketing of all types will be a $63 billion market in 2003. The report was based on interviews with 60 different marketers.

While conducting those interviews, Nail said he “half expected to hear one big dumb company say, ‘Thank God the Internet is over.’ There’s no one saying that.”

Analysts such as Henry Blodget are complaining that the online ad industry should be “only” an $8 billion market this year. Nail calls that glass half full, not half empty. “It’s knocking on the door of radio and print in five years and it’s ‘only,'” he said. “We should all be so lucky as to be worth ‘only’ $8 billion.”

That’s not to say 2001 is going to be any walk in the park. “It’s going to be an ugly year, and next year will be pretty ugly, too. But for companies that learn their lessons and have the staying power for the next couple of years, the long-term view on ‘digital marketing’ is very positive.

“In the long run here’s what happens,” Nail continued, a bit breathlessly. “The traditional guys really will come on board. But big traditional companies don’t move fast. The dot-coms have been 70 percent of the market until now, and you get used to the idea of people walking into your ad agency and plunking down $25 million, saying, ‘Make me famous.’ Big companies don’t work like that. They move slowly, they have to make a business case internally, and they’re first attracted to brand names.”

So maybe your current company will die; that’s not fatal. “The people will move on to other things. As companies go away, inventory gets tighter. Supply and demand also come into balance.

“So don’t sweat the details,” Nail concluded. “Instead, educate the marketplace.” There were two schools of thought from traditional companies. Some said they knew their customers were online, but they didn’t know how to reach them and they couldn’t convince managers to spend money. The other school was that they were going to wait for Procter & Gamble to figure it out, then copy what they do. Some people keep experimenting while others sit on the sidelines until models evolve.

“Either way, those on the frontlines who’ve been working the problem will be very valuable.”

At a time when business is slow, Nail offers wisdom. TV wasn’t built in a day, either. The lull is temporary. You’ve just run a bit ahead of the parade, so slow down and enjoy the view.

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