Soft Economy Drives Marketers to Fewer and Bigger Media Partners: JackMyers Think Tank

Assuming this week39s release of fourth quarter GDP data confirms an official recessionary economy marketers media companies economists and unofficial economic pundits will weigh in with appropriately reactionary forecasts of ad industry doom and gloomThere are certainly indications that the media community should be concerned Automotive forecasts are dismal at best and ad spending in this critically important local and national ad category is down Local political ad spending is not as robust as expected as politicians have discovered the power and value of free online communications especially YouTube Both the financial and real estate industries are being severely impacted and ad spending curtailed which again is more a print and local issue Network TV scatter pricing strong throughout 2007 has softened Online advertising requestsforproposals avails are down compared to early 2007 But while newspapers local television and radio stations and even television networks cannot look forward to fullyear 2008 revenues with a positive outlook the overall ad economy remains reasonably robust2008 will most certainly be a year when the rich get richer Media companies that have invested in relevant multiplatform capabilities and that can deliver targeted audiences across multiple branded media assets will attract the lion39s share of growth in 2008 and into the foreseeable future Those media companies that have been slow to market playing the waitandsee game before investing in new media assets will suffer from the economic slowdownFor megamedia conglomerates like News Corp Time Warner and Disney pressures to integrate crossmedia assets will take on a new urgency as the merger of digital distribution with powerful traditional media brands and reach gains critical importance for expanding relationships with the largest marketers In this marketplace the unexpectedly aggressive efforts of the broadcast networks over the past 24months will reap positive rewards Although NBC Universal39s acquisition of iVillage has been questioned it ultimately will prove to be a valuable asset for extending the NBCU broadcast and cable networks39 advertiser offerings And while FoxTV has been slow to develop integrated sales and marketing initiatives with News Corp39s Interactive assets and especially MySpace integration will be forced by marketers and agencies who are demanding innovative tactics for delivering measurable results for their campaignsSimilarly Viacom has quietly cobbled together a valuable portfolio of social networks gaming sites and virtual world sites that are unmatched in the media world In the next 12 to 24 months the pace of acquisitions by major media companies will accelerate as traditional players realize the critical importance of platform extensions They will also elevate within their organizations those executives who understand and have experience in both traditional and digital media and who understand the marketing requirements of advertisers beyond reach and media cost efficiencies Executives with promotion direct marketing event marketing and public affairs experience will be essential to the growth of media companies as well as media agenciesAmong the leading online and digital media companies the dearth of sales executives experienced in the traditional media marketplace will be an albatross slowing their progress and acceptance Filling executive roles with skilled network sales executives who also have proven online sales credentials will be a priorityThe decision last week by General Motors to allocate half of its annual 3 billion advertising budget to the Internet within the next three years is sending a clear message to all media Rather than a death knell to newspapers and network TV it should be a clarion call to all media to accelerate crossplatform initiatives GM39s strange announcement which was preceded by the departure of longtime GM Planworks39 executive Dennis Donlin suggests there is sufficient relevant inventory to fulfill the auto maker39s online objectives If the company is to increase its online ad spend seven times 2007 levels of an estimated 200 million more good real estate will be required and it39s likely to come primarily on the sites of established media brands In 2007 GM spent an estimated 12 billion on TV ads down nearly 12 from the previous year If Cadillac Chevrolet Pontiac Saturn GM Trucks and other GM brands move too aggressively away from longestablished TV franchises and sponsorship rights especially in sports other car makers will move in quickly and GM39s market share will drop like an anchor leaving the company dead in the water It39s more likely the company will look to extend their most valued franchises across the digital landscapeJoel Ewanick Marketing VP for Hyundai Motor America says quotOnline is getting to the point where it may be more important than the 30second spotquot I disagree But advertisers will demand more accountability from their 30second spots and will look for ways to bring their TV and online budgets together in more measurable and convergent modelsLast week NBC Universal paid 6 million for a 35 stake in Radical Media39s driverTV which is a perfect example of the type of strategic initiatives traditional media companies will require to increase their market share as more and more marketers demand digital integration and direct marketing infrastructures The driverTV web site and VOD channel program threeminute videos underwritten by automakers quotThere is growing need for the automotive industry to find engaging ways to reach potential buyers with information and the driverTV model has been very successful in bringing together car companies and those in the market for new vehiclesquot said George Kliavkoff chief digital officer for NBC Universal Without NBCU39s traditional networks driverTV was another website struggling for credibility With the promotional clout of NBC Bravo Oxygen USA Sci Fi and NBC39s online assets driverTV becomes a powerful marketing vehicle for the auto industry Its why in a softening economy the rich will get richer

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Soft Economy Drives Marketers to Fewer and Bigger Media Partners: JackMyers Think Tank

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Jack Myers

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Soft Economy Drives Marketers to Fewer and Bigger Media Partners: JackMyers Think Tank

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