With the slowdown in 2008, and possible recession, it does require us to look at how it could possibly impact our online businesses and marketing efforts.
Most analysts and experts are expecting a recession this year, but a mild one which will last for maybe two or three quarters.
Historically this has always produced problems for media companies, as they are for the most part reliant on advertising as their chief source of revenue. That's why advertising has always been a cyclical business.
So with advertising dollars about to tighten up, how will that affect Internet companies? The answer is, it probably won't too much.
The reason why is we are happy recipients of the transfer of ad dollars from traditional media spend to Internet spend. That trend, even though the overall economy is slowing down, will make the impact upon the Internet negligible.
I'm not saying if the economy was stronger we wouldn't be seeing more dollars, just that even though things are slowing, the overall trend of putting larger portions of ad spend on the Internet will buffer the overall effects of downsizing ad budgets.
Now for companies that rely on advertising in traditional channels and on the Internet, this could be a different story. But I'm just talking here about companies that primarily provide content on the Internet and monetize through advertising. Those with exposure to other advertising channels are going to suffer during this time.
Comment Preview