In a post over on TechCrunch, Don Reisinger notes how online advertising spend is going up, up, up, while the overall economy seems to be in the midst of a R-E-C-E-S-S-I-O-N.
Intuitively the findings make perfect sense to me. Say you’re an e-retailer who sells products online. You are feeling somewhat of a pinch with sales decreasing and so you look for areas to cut costs. The marketing and advertising budget is almost always one of the first targets, so you start there. You have the option of cutting traditional media, online display or search advertising. With search you know that at least the person is interested somehow in your product or category, hence the search. Online display ads and traditional media however lack the clear connection to interested customers.
So, snip snip, you cut out some traditional media and/or display ads. You may even make deeper cuts and shift some of the spend to search because it is more effective. So congratulations to Google, who has positioned themselves to dominate even an economy in recession.
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