Advertising slump shows no signs of relenting
The news media may be preoccupied with Swine Flu and the Banking Crisis and the Auto Industry meltdown, but look beyond those hot topics and you will see a familiar story — you know, the advertising-business-is-getting-slammed story.
Advertising group WPP today said it would not meet its 2009 forecasts after quarterly sales fell 5.8 percent, as companies slashed marketing budgets. This comes after rival Omnicom on Monday reported that its first-quarter revenue fell 14 percent.
Interpublic needed a heap of cost-cutting moves — including job cuts — to help it post a loss that was smaller that Wall Street expected. Revenue fell nearly 11 percent — maybe that’s a case of it-could-have-been-worse for a company that counts General Motors as one of its single largest clients.
Perhaps a recent run-up in the shares of media stocks portends better days for advertisers, right?
Not really. Experts warn that advertising spending is not yet showing any indication of bouncing back. Omnicom’s CEO John Wren says even those who are “at all optimistic” are looking toward the back end of this year and the beginning of 2010 for any kind of recovery.
And certainly the Swine Flu, the Banking Crisis and the Auto industry’s woes aren’t likely to help.
Keep an eye on:
- McGraw-Hill’s broadcast revenue in the first quarter fell almost 23 percent reflecting softness in both local and national advertising. (Broadcasting & Cable)
- The U.S. Supreme Court upheld a government crackdown on profanity on television. (Reuters)
- Activision may pick Van Halen for its next Guitar Hero game (PaidContent)
(Photo: WPP Chief Executive Officer Sir Martin Sorrell, Reuters)