The other day, during IPGs earnings call, CEO Philippe Krakowsky noted that some clients are requesting contingency plans to cope with the uncertainty and the potential slowdown. Meanwhile, Arthur Sadoun, chairman and CEO of Publicis Groupe, noted through the holding companys earnings call that while there havent been cutbacks yet, that doesnt mean there wont be.
The recognition of a dependence on contingency planning along with more flexibility in today’s economic environment is commonplace, in accordance with marketers and agency execs. They state that, while they havent seen a pull back spending generally, they do visit a focus on planning the necessity to do so. Through the height of the pandemic, having contingency plans and flexibility included in media plans was par for the course and marketers are actually more used to making swift changes on a dime.
Clients in a few verticals have already been centered on getting prior to the curve with addressing the changing fiscal conditions, said Brendan Gahan, partner and chief social officer for Mekanism. For a few of the clients it seems sensible to proactively address uncertainty head-on.
Getting prior to the curve implies that clients will work to make sure our media plans continue being nimble to permit for changes running a business conditions and consumer confidence, explained Carrie Dino, head of media for Mekanism. In accordance with agency execs and marketers, even though they arent actively pulling back, theres a standard outlook to be aware of the necessity to achieve this and being ready with plans set up should that require to occur.
The largest ask from clients is just about commitments and methods to increase flexibility once we navigate the next half of the entire year and beyond, said Stacey Stewart, chief marketplace officer for UM. Were also starting conversations to prioritize efforts around marketing dollars in anticipation of reduced spending while minimizing impact to overall business.
Some marketers and agency execs are prioritizing more fluid digital, social and programmatic media plans over options which are more traditional or harder to cancel. Simultaneously, marketers may also be spending more on audience research to obtain a sense of consumer sentiment and behavior to greatly help inform their decisions now.
Zambezi chief media officer Grace Teng said she hasnt seen any cutbacks or handled many conversations about pulling back media investment. Having said that, Teng added that theres an outlook to be aware of the existing economic landscape and looking back at plans from 2008 to reference how things were handled then taking lessons from how to proceed and what never to do.
3 Questions with Matt Voda, CEO of OptiMine Software
What can you believe may happen first if the signs of the recession are beginning and what type of dangers could affect advertisers?
The chance is theres panic. Brands ‘ve got what we’d call a multidimensional challenge. How can you spend money on marketing to help keep people getting into your business? How can you take action more cost effectively and efficiently? In retail, youve got this dual problem. Youve got inventory thats turning up late you need to mark down that is clearly a drain on profits. And when you make an effort to market and invest to obtain people to can be found in and buy that inventory, youre increasing the trouble. But simultaneously, youre considering this completely back again to school. I’d like shoppers ahead in. And when I stop advertising now and I understand that thats likely to impact traffic later come early july. So they are really complicated challenges that want very sophisticated analytics to access good answers.
How can you think consumer behavior changes?[Consumers are] likely to buy various things. Discretionary items probably arent likely to have just as much demand. However the consumers still have to eat. They still need the fundamentals. So you may have a more impressive concentrate on just the requirements. So a brandname has to consider what moves do I make now to provide myself the very best shot within an uncertain environment 8 weeks from now. From the marketing standpoint, what levers may i pull which may be more short-term so we see channels like search or social may have a far more immediate effect versus TV that may have an extended effect that could be a bit more expensive. And how do you adjust the media channels that Im using from this sort of complicated backdrop of what ifs?
Is there other industries you are connected with which are worried about this possible recession?
Mostly in retail, in financial services. You understand, we utilize a large amount of banks. The questions are they might be similar but may be just a little different. You understand, for people that are in the marketplace for a home loan or perhaps a new charge card, you understand, its a slightly different challenge. What do we do when rates rise? Maybe fewer folks are likely to be searching for a fresh home or perhaps a mortgage. And just how do we market differently for the reason that sort of environment? But a lot of the challenge is in retail for all of us, those brands are coping with this most acutely. So there isn’t a retailer on earth that isnt challenged by this. I believe even Amazon will be coping with this front and center. Julian Cannon
By the numbers
With inflation rising and everyday costs surging, shoppers are holding their dollars a bit tighter.Marketers too are cutting media dollars,targeting more conservative budgets. From gas to groceries have observed costs rise. But prior to the back-to-school shopping season,new research from e-commerce company Rakutenreveals that shoppers will be ready to spend. This implies marketers should expect a busy season and diversify their spend, per the Rakuten report. Additional information from the report below:
- 38% of shoppers can look for back-to-school shopping inspiration on a retailers website or in social posts.
- 34% of shoppers will reportedly search for inspiration from online ads.
- 22% of back-to-school shoppers can look for TV or streaming TV ads. Kimeko McCoy
Quote of the week
Exactly like in Web2, when Myspace became obsolete, we dont even understand if the Big Four players are likely to exist, or if theres likely to be another metaverse thats developed a good couple of years from now.
said Lisa Wang, the founder of Bad Bitch Empire, an investment collective for ladies in Web3, when asked concerning the longevity of metaverse platforms.
What weve covered
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