Bearish signs for ad spending
First came the TNS Media Intelligence numbers, which, though dated, paint an awfully grim picture. First quarter spending fell 14 percent, a big number in its own right, but even more startling when put in context. Take, for instance, the fourth quarter of 2008, when credit had completely dried up and companies were racing to cut marketing, staffing and every other expense. Ad spending then fell just 9 percent. Or how about the fourth quarter of 2001? After the bursting of the dotcom bubble and the attacks of Sept. 11? Spending dropped 11 percent that quarter.
Again, the 14 percent is a backward looking number. The first quarter of 2009 is history. For that reason perhaps the news could be taken in stride — if not for a brief statement by TNS research Jon Swallen that was included in the press release.
“While there are hopeful signs of general economic indicators bottoming out, the advertising sector still appears to be lagging behind. Available data from (the) second quarter shows ad expenditures tracking on a comparable plane to recent months.”
That doesn’t sound like the market is getting any better.
In addition to all of this from TNS, you had some less-than-upbeat comments from Interpublic Group at the Credit Suisse Global Media and Communications Convergence Conference this morning. Frank Mergenthaler, the finance chief of Interpublic, which owns agencies like DraftFCB and McCann-Erickson, made it clear that clients are still scared to write checks.
Any signs that the economy is improving “have not manifested in people pulling the trigger on ratcheting up spending,” he said. “We are seeing signs, but those signs are more anecdotal than companies actually willing to spend.”
Nothing too cheery there.