While media executives are busy trying to convince Wall Street during this earnings season that the ad recession is over, buyers are saying loud and clear that a full recovery may be as much as a year
away. “There’s a lot of volatility in the economy,” said Mediacom EVP Donna Speciale at an AWRT luncheon held last week in New York.
Zenith Media SVP Matt Feinberg agreed. “My guess is it’s not
over, but things can’t get much worse.” That said, he noted, “Clients are releasing money slowly and surely.” In fact, many a media department’s holiday season is filled with visions of retail
accounts filling their stockings.
“A lot of clients are in a wait-and-see mode,” continued Speciale, whose agency places $1.5 billion in national TV and radio spots annually. Last week’s
announcement by Ford that it was extending its 0% financing, and the other car retailers expected to follow suit, the auto ad category should remain strong through the holidays. “That is the big
category that we all have to watch,” said Speciale, who is also taking note of the falling consumer confidence numbers. “You may see a lull in consumer buying, and that is going to have an effect in
the marketplace.”
The big media companies see things differently, however, as radio and TV executives have lined up in recent days to battle which of them would put the final nail in the
recession’s coffin. “We are rocking big time,” Viacom COO Mel Karmazin told analyst during his company’s quarterly conference call last week.
Clear Channel president Mark Mays, whose company owns
radio, TV, and outdoor, also tried to ensured Wall Street that things are improving. “We have built momentum through the year, there’s no reason to anticipate that as we flip the calendar that the
momentum is gong to stop,” said Mays.
Not all broadcasters are as bullish, however. “I don’t think the economy is fully out of danger yet, but we are cautiously optimistic,” said Beasley
Broadcasting chairman George Beasley. Even Viacom seemingly hinted at some softness in the marketplace. It issued conservative projects for next year, a view that seems inconsistent with its gung-ho
attitude toward recovery.
“Advertisers aren’t spending the way the used to,” OMD managing partner Natalie Swed Stone told the AWRT meeting. She believes it took advertisers and agencies a full
year’s planning cycle to feel the full effects of last year’s terrorist attacks and it may take a full year to get over it. Swed Stone says that has changed clients’ priorities, with branding taking a
smaller role campaigns with specific goals and targets. She said advertisers are also more closely scrutinizing agency media plans, budgets, and buys. “They have to see everything before they release
the money,” she said.
That has led to an increasing trend by advertisers to shift where their dollars are being spent, say buyers. Some clients are moving print money into broadcast, for what they
believe will be a quicker sales bump, while Feinberg has seen dollars move from local radio to national. “Standard lead time used to be three months, now it’s three days,” he added. The reason, said
Feinberg, is that they want to make sure they work. “They come back with weekly sales reports and we have to react to that.”