Multi-vehicle pile-up on Madison Avenue
Dimming prospects for an auto bailout spell trouble for the folks on Madison Avenue. Already, sources say that General Motors is taking a hard look at all of its advertising contracts – held by Interpublic and Publicis — to see if they should be renewed as they come up.
That’s a pretty big deal, given that GM forked out about $1 billion in ad spending for the first six months of the year. And overall, domestic automakers spent about $2.8 billion on advertising in the first six months of 2008, down 17 percent, but was still one of the 10 largest U.S. advertising categories.
If you want to know how dependent the advertising industry is on the auto industry, take a look at Advertising Age, which has a in-depth feature on it. The upshot:
If one or more of Detroit’s carmakers goes away, gets smaller or goes into bankruptcy, “all media companies need to be concerned and there will be an impact on agencies, which derive a substantial amount of their income from [Detroit],” warned Bob Liodice, president-CEO of the Association of National Advertisers. “These are substantial, heavyweight players. You’ve got some of the largest marketing spending companies in America.”
Keep an eye on:
- Ziff Davis Media announced Wednesday that it was ending print publication of its 27-year-old flagship, PC Magazine, and would take the title online only (NY Times)
- Ben Silverman, the co-chairman of NBC Entertainment and NBC Universal Television Studio, has joined the board of the Peacock Equity Fund (The Hollywood Reporter)
- Google is shutting down Lively, the virtual world that could be embedded into other Websites (TechCrunch)
- Publicis hopes it can beat the advertising market in terms of revenue growth and margin in 2009 (Reuters)