On Friday, The Guardian published a very good chart showing the relative growth of each of the major media in the UK’s advertising revenues.
The chart ends with a 2008 estimate that internet advertising will outstrip the whole of TV.
Yet I think we need to be a little careful here, and make sure that we’re not comparing apples with oranges.
While I don’t doubt that the sums being talked about are accurate, as we enter a recession it seems very odd that so much new money is entering the advertising market. While other media are showing either flat revenues or very slight declines, the internet is seemingly outstripping the entire market by a large factor.
Without the numbers behind the chart, it’s hard to tell the exact numbers, but broadly speaking, the cumulative effect of this chart seems to show overall advertising growth of around 7% between 2007 and 2008. Obviously these are estimates, but with a struggling retail sector, I’d be amazed if this was truly the case.
The main thing to know is that the revenues being reported here for most media are display. And while there’s a lot of display coming into online, that’s still probably not where the bulk of Google’s revenue growth is coming from. AdWords and the like are more akin to classified advertising which isn’t included in the newspaper figure. This has certainly taken a pummeling in the local, regional and even national press, and I’d be surprised if even the Yellow Pages hasn’t taken a significant hit.
Anyway, an interesting chart – but treat with caution. Advertising money does not grow on trees even if you are the internet.