Advertising Age reported that Fitch Ratings gave a gloomy outlook for advertising in 2009. The word used to describe the upcoming year was “gloomy”. They are predicting that the advertising environment next year will be the weakest it’s been since the 2001 downturn and that was the worst ad recession since 1970.
What most people don’t realize is that it is not just about national, mass advertising that is in risk. There is a substantial amount of local advertising as well. It is the local advertising that drives so much of the production end of the industry that it in fact could be the most impacted.
Take the auto industry. National brand ads, banners, newspaper inserts, TV commercials…they can all be produced once for the entire country. It is the local ads that require almost as much production but only run locally, thereby often making their investment much greater on a per impression basis. Does this mean local advertising is dead?
Online, the efficiencies are more evident as one ad can be reused locally with minor impacts on production. In fact ads online can even be dynamically created based on the location of the consumer or the website.
Categories with the most pressure will include retail, automotive, financial services, airlines, hotels and car rentals. These are also categories that could realize substantial efficiencies from localizing ads online.
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