IDC: Online Ad Spend Drops for Second Consecutive Quarter

Advertisers worldwide continue to spend less on Internet outreach in 2009 than they did last year, according to a new report from IDC. But the situation no longer seems likely to get worse.

Global spending on Internet ads contracted for the second consecutive quarter, by 5.9 percent, coming in at $13.9 billion, which is down from $14.7 billion in the same quarter last year, according to IDC’s Worldwide and U.S. Internet Ad Spend Report 2Q09. Losses were reported across all global regions with the exception of Asia/Pacific and Japan, which saw slight gains.

The Q2 drop in the U.S. outpaced the global average, falling by 7 percent, from $6.6 billion to $6.2 billion. Search ads were affected less than display and classified ads in the U.S., and publishers were affected accordingly: Google was the sole publisher in the U.S. to post a gain, albeit in the single digits, while Monster.com suffered the biggest decline of 31 percent. AOL and eBay were also hit hard by the decline in classified ads.

“Things are bad, but they’re not getting any worse and are likely to look up soon,” Karsten Weide, program director of digital media and entertainment at IDC, said. “It’s a safe bet to say we’ve bottomed out, though we probably aren’t going to see growth again until Q2 of next year], and the recovery will likely only be in the low single digits.”