aQlog
A new survey finds that 53% of major marketers expect their ad budgets will be reduced within the next six months because of the spiraling economy. And 87% say they have already made cutbacks in their marketing and ad plans. The poll, fielded by the Association of National Advertisers, also finds that while the majority of marketers (53%) expect additional cuts to be modest—ranging from 1% to 10%—27% expect cutbacks to be more substantial, in the 11% to 20% range. A smaller group—about 10% of the respondents—are expecting that their budgets will be gutted, with decreases of 30% or more. The ANA also asked its respondents—100 marketing executives from a wide range of industries—what kinds of spending would most likely be cut or eliminated. About 69% say that they expect to reduce media budgets, 63% expect to trim ad production budgets, 63% anticipate travel and expense restrictions in their department, and 61% say they will either drop or delay new projects. And 63% also plan to put more pressure on their ad agencies to identify cost reductions. “Effective marketing spending during economic downturns is not about how much you spend but how you spend it,” the trade association says in its release. “Marketers must assess how consumers and customer behavior can be positively influenced during tough times. If it can, then marketers should give increased consideration to more spending rather than cutting.”
With regard to the article, I do wonder when ‘ad agency’ language will evolve into this century. Journalists and practitioners seem to be equally behind the times.
Wrong verb choice. Clients and professionals in marketing communications are going to be focused on “investing” not “spending”. And, oh my, in times of economic turbulence or not, everyone has to be thinking about Return on Investment and Return on Ideas.
If I felt my broker was just spending my money on his recommendations in order to pad his commission income, I would be bringing my account in-house and e-trading the next day. Is this just a matter of semantics? You betcha. Words have meaning. As people in the business of creating meaning, ie brand experiences, for customers and prospects, I think we have to walk a talk that the clients value. And it has to be an authentic win-win-win effort. The customers win ( or they don’t come back), the clients win ( their business builds) and the communications firms win because they are providing value.
For what it’s worth…ad agencies that spend their clients money are going to get what they deserve, a declining rate of interest. The upside for them is at least they will have more time to catch up on past episodes of Mad Men.
Alan Quarry
Despite my disdain for some advertising, you can’t deny the appeal of Don Draper!
Isn’t this good news for those of us in PR? We can expect penny-pinching organizations to see the real value in PR as they’re forced to veer from expensive (and fruitless) marketing and advertising campaigns. We can generate better ROI through PR tactics than any billboard or 2 minute spot on primetime because, even in economic turmoil, the ability to build and maintain relationships has never been easier.
— Brandon Carlos · Sep 10, 12:57 PM
You ‘re absolutely correct Brandon. Public Relations is an incredibly valuable and cost effective component of an successful integrated approach. The expensive monologue model of ‘advertising’ is most likely to be a spend, not an investment. Strategically planning and then using the other methods of helping prospects and customers learn about the benefits offered by a brand? That’s investiing.
I am a big believer in the power of pr, especially in times of tighter budgets.
Thanks for your post!
— Alan Quarry · Sep 15, 07:47 PM
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