All across the ad-Webs today the talk is of how people aren’t buying advertising space anymore. It seems to have stemmed from a weeks old article Eric Clemons, Professor of Operations and Information Management at The Wharton School of the University of Pennsylvania. He wrote a long piece about why advertising will fail on the internet, and TechCrunch published it, and now all these “reports” are basically verifying what Clemons said. Oh shit.
A few of the finer points of his article:
— The internet is not replacing advertising but shattering it
— Consumers do not trust/need/want to view advertising
— Alternative models for monetization are available
Anyway we don’t really think Clemons’ story has brought about these reports but they seem to be getting more press lately and his story was kind of earth shattering to a lot of people so we’re comfy making that connection. Oh, and here’s the basics of what we’re talking about.
1. In the UK, 45% of companies reduced their ad budgets in Q1 2009. The research company behind this report says that means things are looking up since in Q4 2008 40% of companies reduced advert. budgets. Wow, compelling.
2. Publicis Groupe says the global ad market will suffer a 3% decline in 2009, and this thing probably won’t start getting better until Q3 2010. That’s 1.5 years from today, lest you wondered.
3. Measured media is always a good metric to track, and GroupM thinks it’s set to drop 4.4 percent to $425 billion in 2009. In 2008 when things were less sucky, spending was up 3 percent. But this is an interim forecast, so who knows what it means.
Frustrated? Yeah sure. But at the end of the day it all depends on the agency you’re sitting in right now. If you’re behind a desk that looks just like 400 other desks in your building, maybe you’re a little more insulated but closer to the fire. If you’re in somebody’s mom’s basement but your clients love you and aren’t cutting back too much, that’s OK too. What’s important is to think about your company and ask your boss what the hell is going on. Knowledge is power! Oh, after asking your boss wtf is going on, e-mail us at matt at mediabistro.com or superspyin at gmail.com.