Aegis Pins Growth Hopes on Digital Media

Aegis credits its investments in interactive media for helping position it for future growth, saying digital is becoming dominant as consumers change their usage patterns. The company’s Carat unit said it expects half of all media consumed to be digital by 2007.

The company this week revealed its thoughts about the future of the media landscape and also reported earnings for the first half of 2005.

“Today there needs to be life beyond the 30-second TV spot,” Aegis Group CEO Robert Lerwill told financial analysts. “Digital is becoming the dominant media.”

In its media forecast released yesterday, Aegis agency Carat said it sees television’s share of ad spend leveling out and newspaper’s share declining. Budgets are shifting to the Internet, Lerwill said.

“Spend on online advertising has outgrown radio” in the U.K., he said, “and we expect to see this catching up with outdoor during 2005.”

In the U.S., Carat expects online expenditure will grow past six percent next year. The company believes the Asia-Pacific region to be an area of particularly strong growth. By 2007, it expects online advertising spend to be higher in Asia than in Europe.

In keeping with the theme of digital ascendancy, the holding company said its one-year old digital media division, Isobar, has experienced organic growth of over 20 percent in the first half of 2005, accounting for almost 13 percent of the revenues in the media category. Lerwill said Aegis planned to expand Isobar to the top 40 global markets. Currently it has a presence in 26 markets and employs more than 1,100 people.

Lerwill also said the company was building Isobar to be a full-service agency, handling both media and creative.

“Although creative is something we’ve distanced ourselves from in traditional media, creative is very different in the digital world,” said. “There is a critical interrelationship between media, creativity and technology that is intrinsic to developing truly interactive, non-linear communications. Creative and Web build are therefore a part of the end-to-end service offered to clients of Isobar.”