Ad World Looks for Recession's Silver LiningAuto bailout, strong midseason and new data from Canoe Ventures offer hope as advertisers shift focus to accountability 1/04/2009 01:00:00 PM Eastern
The final episode of the millennial decade has begun, and it features a waddle of media and marketing businesses huddling like emperor penguins for protection against the worst of times. Welcome to 2009.
But some say the outlook might not be so bleak after all. Optimists point to a bailout of the auto industry, the upcoming inauguration and a (hopefully) stronger midseason lineup for the broadcast networks as beacons of hope. And the green shoots of a possible recovery are springing not from the usual positive-spinning PR reps, but from operational business executives who think the current down cycle has some useful upside.
“The economy has made us shift our focus. We're working on accountability,” says Tracey Scheppach, Starcom USA's video innovation director and resident media futurist.
“Everybody is asking for more value,” adds Gibbs Haljun, managing director of media investment at Mediaedge:cia North America, which counts AT&T and Paramount as clients. “And it can translate into pricing reductions, more ratings points over delivery and incremental added value. Everybody is being asked to make media do more.”
And with that comes a long, hard look at the performance of buys that have already been placed, as well as upcoming marquee events. On the traditional advertising front, advertisers will be permitted to pull 50% of their upfront buys as part of second-quarter cancellation options due in mid-January. Until that happens, many agency buyers are simply holding their cards and bargaining hard for a reduction on big-ticket “luxury buys,” such as the Academy Awards and BCS football. Several Super Bowl spots are still available.
Despite those questions, many remain bullish on television in 2009; they just expect the marketplace to continue to evolve. “I see a very rosy picture for TV,” says Starcom's Scheppach. “Viewership is up; it's just going down the tail where it's unrated by Nielsen.”
Scheppach is looking forward to new TV viewing data about to cascade from Canoe Ventures, the cable joint venture that is processing set-top box data, for the first time, on a national basis. She expects that at some point all TV operators will be Canoe participants, and in an ideal world, advertisers won't be bombarding viewers with up to 60 messages per hour. Instead, watching TV will be a less-stressful endeavor with lighter ad loads that both entertain and inform, thanks to precision targeting.
Cable continues to have momentum heading into 2009. As Steve Mandala, NBC Universal's executive VP of cable sales, somewhat predictably says, “Advertisers are cognizant that's where viewing trends are moving.”
But all eyes will be on the broadcast networks this month after another sluggish fall. Few rookies made the grade, and many returning shows continued to shed audiences in alarming fashion.
The networks collectively hope that the return of big-tent names like American Idol, 24 and Lost will drive viewers back to the networks. And since the writers' strike made for a sparse fall in terms of new product, the networks will also be hoping that as more freshman shows debut at midseason, CBS's The Mentalist will have some company in the chase for rookie of the year.
At the local station level, it is no secret 2009 is daunting, so innovation is absolutely the order of the day. Kathleen Keefe, Hearst-Argyle Television's VP of commerce sales, says her company has made a corporate decision to help keep struggling partners in business. Hearst stations have partnered with local auto dealer associations to produce PSA messages saying that there's never been a better time to buy a car, with great deals and low gas prices around. The company has also grouped realtors and retailers to help them afford airtime.
Now that the auto bailout has presidential approval, Keefe thinks the local ad market will be on more solid footing. Her group is chasing and winning ad dollars from a host of sectors such as credit unions, cosmetic surgeons and lawyers.
Keefe credits that development to a sharp focus on new business, most of which didn't exist in the first quarter of 2008: “People are literally falling out of newspapers and the Yellow Pages. That's a jump ball.”