As recession looms, companies will look to cut their ad spending that includes search marketing. Advertising trails the economy in a recession: advertising budgets are usually committed in advance. Search marketing is different from traditional advertising (through traditional media outlets). It is more international in nature, so it might be less affected by U.S recession. It is critical to track consumer spending behavior that might provide tell-tale signs if this economy can be rescued from a deep recession or not. Analysts and investors seem to be optimistic about online advertising business. But we have little time to observe in terms of how online advertising responds to macroeconomic shocks. We can see some of the leading Internet search stocks taking a hit in the recent past. Google down 38%, Yahoo laid off 10 - 20% of its staff.

Posted: 03|3|08 at 3:49 pm. Filed under: Digital Media, Web2.0. Comment | Trackback