According to new study results from ad spending tracker eMarketer, (1) spending for online advertising is slowing; (2) online advertising still pulls budget away from offline ad campaigns; and (3) search advertising continues to be a bright spot in the economic gloom.

“Once seen as immune to economic slowdowns, the online advertising sector has now become the downturn’s latest victim,” noted Jeff Meisner in Online Ad Sector Showing Signs of Strain in E-Commerce Times.

However, such a “down” statement was only on first glance. Advertising’s budget pulse is weaker, stronger or holding steady … depending on where you measure it.

·  Slower Growth: After predicting 2009 online advertising growth of 14.5% in August, eMarketer recently revised its projections down to 8.9%, following collapse of real estate, financial and domestic auto markets. Pushing into the next two years, eMarketer is still projects growth, but at slower rates: 10.9% increase in online ad spend for 2010; 13.5% growth in ad spend for 2013.

 ·  Still Looking for Bottom: Slowdown has not yet hit bottom, according to a Click Capital Research analyst via E-Commerce Times. Click Capital’s Colin Gillis predicts a five-to-ten percent decline in the 2009 ad budget, hitting bottom in first quarter, which Gillis says is always a weaker ad spending period.

 ·   Online Still Grows: Now, for some good news: While overall online advertising growth is, indeed, slowing, it still is growing compared to ad spending in print, radio and TV. (All offline ad channels continue to slide down budget priorities.)

 ·   Search Ads Best Display Ads: Saving the best for last, eMarketer analyst David Hallerman cuts search advertising – pay-per-click and paid-inclusion campaigns that pull in prospects from online keyword searches — away from display advertising, the online equivalent of printed display ads that feature banner and graphic space buys on web pages.

     o  Display Advertising tends to show lower conversions, or customer responses, than more cost-effective Search Advertising

     o  Because of lower rates of customer conversions, display advertising tends to have less ROI in ad campaigns

 Or, as eMarketer’s Hallerman told E-Commerce Times:

 “When budgets are tight, companies look to make the most cost-effective purchases they can. That’s one reason why display advertising will be far flatter than search.”

 This also explains why remaining ad budget funds are being re-directed under difficult economic conditions to search advertising over all other channels, on and offline.

 Have a look at search and display advertising options targeted to wholesale merchandise buyers and sellers (served by Top Ten Wholesale’s network of sites) at Advertise with TopTenWholesale .