Decrease in Media Budgets

Advertising Age had this informative article about a study conducted by Advertising Perceptions, a market-research firm. According to the research study, media buyers are pessimistic about Broadcast TV, magazines, newspapers, radio, and outdoor, and have plans to decrease their advertising budgets for these mediums. Broadcast TV, and newspapers are the hardest hit, with 30% of the respondents citing a decrease in their expected spending over the next six months. On a positive note, online, cable TV, and mobile are not experiencing the same downturn. For online media spending, 72% of study participants are anticipating an increase in their spending, and for cable and mobile the percentages were 28% and 53% respectively. Audrey Siegel, a VP Director of Client Services for TargetCast, believes that, The decline indicates that marketers need their dollars to be flexible during times of economic uncertainty so they have the opportunity to pull back on spending if necessary. On a contradictory note, as reported in the NY Times in this article, Mr. Coen senior VP and forecasting director at Magna, is optimistic citing the Olympics, and the political campaign as a reason why advertising will not be as hard hit as the Advertising Age article suggests. Coen was quoted as saying, 'It will get better in the second half of the year. I think the worst is over in terms of the slowdowns.' In summary his belief is that while the economy has played a huge role in the hesitance of media buyers to spend their advertising budgets, the decrease may not be as noticeable while the Olympics, and Political campaign remain a hot topic in the media. His predictions also have him quoting that 2009 will be better than this year with advertising spending up 3.1%. It will be interesting to see which perception will prevail.