According to the “Media Advertising Forecast” from MAGNA, nearly all media sectors will experience advertising spending declines in 2009.
Hardest hit will be traditional media such as newspapers, radio, magazines and TV, each falling by 14% or more.
Even the once-indomitable online ad space is faltering, with MAGNA expecting a 2.2% total spending decrease. …
Working for a major Canadian digital publisher, I have seen the ups and downs in the past months as advertisers and agencies scramble to decide what to do with their ever precious marketing dollars. The nice thing, is that in most cases, I have seen the ups as digital spend, which still usually represents less than 10% of total marketing budgets has remained intact or often grown substantially. The reality is that marketers worldwide are shifting more of their budgets into cheaper, more-measurable categories and that usually means online.
Back in December I wrote a post about maintaining the status quo in a down economy. In that post I reference the auto industry and how some companies, like Hyundai had an incredible opportunity to increase share of voice and ultimately sales as a result of their competitors reducing ad spending. Without doing so much as maintain status quo, there was tremendous opportunity to take market share away from the competition. Apparently The New Yorker thinks the status quo is not even enough and goes as far as saying that ratcheting up spending during a downturn may be the best way for a company to make it through the recession. While that might sound counterintuitive, it’s the theme of several pieces of research that James Surowiecki highlights in this week’s column in The New Yorker.
General Motors Corp. might not wait 60 days to declare bankruptcy. The automaker’s new CEO, Fritz Henderson said GM could head to bankruptcy court for a quick reorganization before June 1 if it can’t make deep cuts fast enough to meet the Obama administration’s mandate for a revised revitalization plan in 60 days.
Under GM’s earlier restructuring plans, filed late last year, the company would keep four of its eight vehicle brands: Chevrolet, Cadillac, Buick and GMC, although Pontiac would remain as a niche nameplate with a much smaller lineup. Mr. Henderson said GM is executing that plan and he said it was inappropriate to discuss whether some of those four core brands might not survive should GM enter bankruptcy court.
Often we find ourselves using social media tools the way they were intended to be used. Log in, search, read an update, poke, contact someone…but why do we limit ourselves to be viewed as just another profile? We are real people, behind desks, in cars, on the couch, trying to succeed in whatever our choice endeavors are. Some people wake up to the fact that they can do things a little differently. Often it is in times of economic need that the real innovation comes out. Yesterday I received an email from an old friend who I am connected with on Linkedin.
In a recession market, it makes sense that use of coupons will increase. Often, retailers will distribute coupons with a safe guarantee that only a small fraction will be redeemed. The value of the coupon obviously has an impact on the redemption rate as the higher the reward, the higher the redemption rate. When times are tough, simply making the coupons and distributing them becomes a cost many retailers do not want to incur. That said, they know that offering incentives to shop through coupons will hopefully drive increased sales. So what to do? Simple, put the coupons online for customers to self service.
The Interactive Advertising Bureau have changed their tune and are now predicting that the whole businesses dependent on online advertising could go belly up, and researcher IDC has completely reversed its growth estimates. No longer will online ads grow 10% in 2009, says the firm. IDC now predicts a 5% drop in revenues in the first quarter that could get worse in the second. I am not sure why anyone should be surprised at this, the recession was bound to impact on all aspects of marketing spend, not just traditional media.
AdAge.com recently published an article trying to shed some light into the crystal ball we all seek answers from. What we are looking for is a way to be optimistic, to say there is a silver lining, and there are bright spots out there somewhere. So below, republished from AdAge are some areas that might provide opportunities for the marketing and media industries to not only survive, but even thrive in 2009.
WASHINGTON
In case you hadn’t heard, there are some new faces in the nation’s capital, and they will fuel growth for lobbying, public affairs and policy advertising in ‘09.
Everyone in the business knows that the economy is hammering ad spending, almost across the media board. There is one exception.
Search.
“Search ad spending may not be recession-proof,” says David Hallerman, eMarketer senior analyst and author of the new report, Search Ad Spending: Reactions to a Recession, “but it is proving to be recession-resistant.” eMarketer estimates that while the rate of search ad spending growth was down in 2008, search still grew 21% over 2007.
As we enter 2009 in a recession, many advertisers are pulling back. Pulling back on production of ads, pulling back on media spend, and pulling back on share of voice. Simply put, advertisers are laying low, and avoiding being in the face of consumers to the same degree they have in the past. Under normal circumstances, this would be a concern. In a recession it is even worse.
Television seems to be on the list to be one of the hardest hit media channels in the upcoming year. Here is why advertisers should be considering investing in television versus pulling back;
Campaigns using television see average market share gain of 2.7 percentage points per 10 percentage point excess share of voice (compared to a gain of 0.7 points for campaigns not using TV).
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