Though the Sept. 11 tragedy whacked an already dismal advertising outlook on TV and newspaper companies, it had less of an impact on Internet advertising than has been assumed.
During the week of the attack, Internet advertising impressions (the number of times ads are delivered for viewing) were just 5% less than in the week before, according to data from both Jupiter Media Metrix and Nielsen NetRatings.
Even better, the loss was erased the week of Sept. 17 when impressions rose above pre-attack levels. Then, in the last week of the month, the reversal rose to an 8% gain. That excludes house ads, company-sponsored donation and condolence ads, and an 85% increase of impressions for public service advertising.
TV and newspapers ran virtually no advertising for a week following the tragedy. Some Web sites pulled some ads to speed access time as traffic surged. But overall, the increase of visitors boosted total impressions.
Some of the increase was due to the usual post-summer upturn of online usage. Internet advertising also didn't suffer across-the-board cutbacks during the last two weeks of September, as did mainstream media. Advertisers apparently were focused on adjusting their largest campaigns. In addition, ads in the Internet environment were less prone to looking like insensitive commercialism.
Jupiter's AdRelevance unit also reports that while new Internet campaigns were at first postponed, previously placed ads continued to run, and by month end, new placements had recovered to pre-attack levels.
Only four of Jupiter's 13 advertising categories ended the month with a falloff of impressions: travel, consumer goods, telecommunications and automotive. But those sectors combined to account for just 20% of total impressions. Their losses were overpowered by hefty gains among media, entertainment and software.
The largest was software's 48% surge, paced by Microsoft's campaign for Windows XP. Ad impressions for virus software leader Symantec soared in the wake of the Nimda virus scare that began on Sept 17.
Use of e-mail marketing (not reflected in the data) highlighted the Internet's multiple marketing abilities. Promotional mailings led the airlines' carefully calibrated renewal of marketing.
The bad news is that a relentless 18-month decline of Internet ad rates has continued to pressure revenue even as Web use has risen.
The impact of Sept. 11 dashed hope for recovery in the fourth quarter. Still, growing Internet use will continue to attract advertisers. What they'll be willing to pay as budgets shrink is another question.
Charles Buchwalter, AdRelevance vice president of media research, says that "[when] the economy as whole finds new footing, [Internet advertising] could rebound a bit earlier than the overall market." Mr. Buchwalter attributes that to "the relative low cost of online ads and reduction of ad space inventory from consolidation of leading sites."
That could make the likes of DoubleClick, Yahoo! and CNet a better recovery play than mainstream media--or for the sheepish, a leading indicator for it. There's risk that smaller overall ad budgets could instead make allocating funds to the Web more difficult until later in a recovery. And odds that net stocks will decline further are equaled by the prospect that they will stagnate for many months.
David Simons, Forbes.com. October 8, 2001
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