Online advertising poised for a big 2008

Services for Real Estate Pros with Zillow

Lehman Brothers put out a great research report today with their 2008 advertising forecast. Since Zillow is a media company, we take great interest in macro advertising trends, especially online advertising trends. Here are a few nuggets from the report:

  • $311 billion in US Advertising in 2008, up 4% versus 2007
  • $26 billion in US Online Advertising in 2008 (source: Interactive Advertising Bureau), 24% more than in 2007. (No surprise here: online is growing much faster than other forms of advertising.)
  • The Internet still only accounts for 8.4% of all US advertising spend in 2008 (up from 7.1% in 2007), despite the fact that the Internet accounts for 28% of all media consumption (source: Forrester). In other words: Online advertising is still much smaller than it should / will be.

Lehman Brothers takes the words right out of my mouth when they write in the report:
“We believe Internet advertising will be the most resilient among the major advertising categories during a recessionary period, as the category should continue to benefit from the overall secular shift of advertising dollars to online as marketers look to efficiently capitalize on shifting media consumption patterns and focus on reaching the consumer in a more relevant and targeted manner. While the Internet represents 19% of total U.S. media consumption, despite accounting for ~7.1% of 2007 total U.S. advertising expenditures according to our estimates, we believe time spent online is likely to increase going forward as the Internet currently represents 28% of media time for the 18- 26 year old demographic (Forrester Research). Additionally, with the measurability and ROI capabilities associated with advertising online we believe the medium is likely to attract new advertisers, while expanding the spend of current ones, as an increasing number of advertisers turn to the Internet to efficiently boost their reach and frequency, especially during a more challenging macro-environment.”

And for the finale, one last data tidbit that I personally found quite fascinating: $1 billion will be spent in 2008 advertising campaign elections, $850 million on the presidential race alone. (source: CMAG and Lehman Brothers)

If you want a copy of the report, email me at spencer at zillow dot com.

(Disclosure: I also posted this on zillowblog.) 


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Dave Woodson
Dave Woodson - Chesterton, IN
Not the Average Agent
I will be emailing you for that report
Nov 29, 2007 03:23 AM #1
Mike Klijanowicz
Cummings & Co. Realtors - Perry Hall, MD
Associate Broker @ Cummings & Co. Realtors
What a waste of money for politics!  Interesting post, this is why I have really started to spend much more time online looking for better ways to reach out and touch my soon to be clients since most are starting their home search online anyway!
Nov 29, 2007 03:28 AM #2
Larry Wright
nwRealty.Com - Tacoma, WA
Spencer ... I've observed 4th quarter PPC prices remaining higher than previous years.  A sign of things to come?
Nov 29, 2007 03:32 AM #3
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