It seems everyone's weighing in on whether we're in a recession or not, with Warren Buffett adding his thoughts today.
Whether the official definition of two straight quarters of the gross domestic product in the U.S. (being the definition in identifying a recession) is met, we all know the growth of the economy has slowed down, as evidenced by the 0.6 percent increase in the quarter ending December 31.
The question for any online marketer relying on an ad model then becomes: "How will it affect my business?"
With the reality being the Internet becoming an ad mecca is relatively new, and having never experienced a downturn since that has happened, we don't have any historical precidence to give us an idea. The dot com crash was based on something else, and so can't be looked upon as a guide.
Most people in the industry conclude that the online ad market should remain strong, and at the worst we'll experience a mild slowdown, rather than anything dramatic.
Jon Kelley, president of Sure Hits, an online advertising and marketing firm, said this: "The trend of online advertising growth is stronger than economic recessionary trends.
"On the mortgage side, you're seeing some effects. But since we focus on insurance -- a product that's recession-proof -- we're not seeing it."
Others like says Rich Kahn, CEO of eZanga, said the company has had to double their sales force over the last month.
To me, I don't think we'll have any crisis in online ad revenue at all over this period of time, and can count on revenue increasing in this area, regardless of what happens in the general economy.
Having said that, we do need to be aware that some categories, like Mortgage companies, may possibly decrease ad spending, and if we rely on that strongly, need to have risk management strategies and contingencies in place in preparation for that possibility.
The trend of advertising money surging to the Internet won't end for years, and we can count on that to remain consistent. It's not a matter of if it will continue to grow, it's only a matter of how much and how quickly.
So how will all of this affect our online businesses? I don't think it will much at all, and we can confidently count on that remaining the case for the next several years at minimum.
We just need to keep on top of what industries are struggling the most, as pockets of advertising dollars in certain markets may decline, but overall it should remain strong and robust.
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