If you read the news, or live on one of the coasts, you may see ships full of goods stacked in the distance. These are the goods we are hearing retailers complain are lacking on car lots, furniture showroom floors, grocery stores, retails stores and so much more.
You may even have clients who are telling you they have nothing to sell. (We will talk about this comment later.)
This is all happening of course because of the stops in the supply chain, government-funded extra unemployment benefits and so much more. The impacts of a country-wide shutdown are being felt far and wide and the ripple effects are tremendous.
To add more complexity, privacy changes, issues with the FANG that are beyond our control and changing media consumption have all made reaching a consumer when you have different inventory or products to sell even harder.
So, with all of this, you might think advertising has slowed to a halt, right? Well, no -- that is not the case.
There are several reasons.
First, you can cover the difference between above-the-line and below-the-line approaches to marketing (air cover – versus response or business outcome-based marketing).
Second, we can discuss that smart marketers who look back at history and see pull-backs or recessions know that those marketers who continue to advertise or double down come out stronger on the other end. Now we can debate that this is nothing like we have seen before -- but stick with me …
Innovation comes from challenge and change. COVID has changed so much about the way consumers shop, buy, consume media, work and so much more that companies need to change the way they advertise, operate, manage teams and more.
On the company side, here is an interesting example we have seen. The furniture industry that has relied for years on the Middle East and Asia is now turning to closer regions like Mexico to try to produce.
Despite all of these challenges, Magnite and others are predicting record ad spend in 2022 as the V-shaped return hits its peak and spending eventually levels out. This is because of predicted rebounds in supply chain, coupled with the 2022 mid-terms and an Olympic year.
According to the report, "Looking at spending verticals, only four (auto, travel, restaurants, personal care) will remain under index 100 at year end 2021, but they will all catch up to pre-COVID levels in 2022. A return to normal business conditions for all verticals, a robust macro-economic outlook, and the mid-term election boost will fuel double-digit growth again in 2022: +12%, to reach the $300 billion mark for the first time."
As indicated in my previous FANG article, we expect that a large portion of this budget in 2022 will benefit TV and audio (all forms linear and CTV as well as digital audio in particular) as these traditional mediums provide additional levels of targeting, measurability, brand safety and attribution, and because some of the digital-first mediums like Facebook, Twitter and Google will likely not be considered by mid-term advertisers as favorable as they had been in past
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The opinions expressed here are the author's views and do not necessarily represent the views of MediaVillage.com/MyersBizNet.