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Internet Marketing Revenue Falls for Second Consecutive Quarter for the First Time Since the Dot-Com Bust

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Online marketing slipped 5% in Q2 as the recession extended the first decline in online marketing since 2002.

This marked the second consecutive quarterly decline in online marketing since the dot-com bust at the start of the decade. That decline resulted in eight consecutive quarters of falling online ad sales.

In the first half of 2009, internet marketing totaled $10.9 billion, down 5% from the same period of 2008. Almost 50% of that money has been spent on search engine marketing with Google, making Google the controller of 2/3 of the U.S. search market. In fact, Google’s ad revenue for the first half of the year increased by 4%.

SEM experts predict that revenue will pick up as the U.S. economy recovers and advertisers increase their efforts to connect with consumers who are going to the Internet for information and entertainment.

The Internet’s advertising prices are also lower than those offered in traditional media. As a result, these advertising trends are the primary cause of traditional media suffering much steeper advertising declines than the Internet.

For example, print advertising has been falling for the past three years, including a 29% drop in Q2. Marketing analysts doubt that all the advertising dollars that have migrated away from traditional media will return, even after the economy recovers.

–Source:  The Associated Press 10/05/09

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