Why Google Doesn’t Own the Next Chapter in Web Ads

Heads up: It’s “Advertising Week” in New York, which means that lots of ad-related companies are going to put out press releases with even less substance than usual.

That said, we can at least do some scene-setting for you courtesy of new forecasts from ZenithOptimedia, the media buying/research group. The official headline today is that Zenith has cut its global ad spend forecast for the year from 4.3 percent to 3.8 percent, because a big chunk of Europe is melting down.

But the news would be if a forecaster didn’t acknowledge the fact that people are eating out of trash cans in Spain. And in any case, Zenith expects Europe to start improving as early as next year.

So let’s focus instead on the different places advertisers can put their dollars. Here’s Zenith’s breakdown for the U.S. market:

Since you’re reading this site you know the broad strokes: New media growing, old media slowing. But do take another look at those TV dollars, which remain dominant and unmoved. Digital’s growth, to date, remains fueled in large part by the decline of print.

Things get most interesting when you dive deeper into digital, and look at how that money is being split up. For a very long time, “Internet advertising” has essentially meant “paid search advertising,” which means Google.

Not anymore. Display ads are finally gaining speed.

Globally, display ads will be growing at a 20 percent clip the next couple years, Zenith says, while paid search will move at 14 percent. Google is a big player in display advertising, too — it has been spending heavily on acquisitions there for years — but it doesn’t have anything like the lead it does in search.

That’s a big growth story for Facebook and a potential lifeline for Yahoo and AOL. And if somebody else wants to build a business based on selling ads — not just eyeball acquisition, but the actual work of turning those eyeballs into marketing opportunities — that’s a real opportunity for them, too.

[Shutterstock/Roman Sigaev]