Andrew FrankThe Online Media and Marketing Association’s annual conference (OMMA) in NYC is on, and as has been the custom for the last few years, Geoff Ramsey, CEO of eMarketer, gave his trademark opening keynote, “Warp Speed.” This year, however, the pitch felt more like it was running on impulse power. (Sorry, no more Trek jokes, I promise.) The theme was supposed to be “Platform Wars,” but this quickly gave way to current economic conditions. Early on, Ramsey cited a recent ANA (Association of National Advertisers) survey that revealed 53% of [U.S.] marketers expect a reduction in their ad budgets in the next 6 months,” and also revealed eMarketer’s latest reduction in overall U.S. ad spending forecast: 1.9% growth, despite the Olympics and the election. That’s pretty grim.
Of course, online advertising remains a relative bright spot, if somewhat dimmer than in recent years: eMarketer forecasts for growth in U.S. online ad spending have been reduced from 27% to 17.4% for ’08, although online media companies can take solace in the notion that, at $24.9B in U.S. ’08 spending, online media are poised to overtake consumer magazine spending this year, having bested radio last year and outdoor the year before. In other good news, comScore revealed that, for the first time, social media has eclipsed porn as the number one destination category on the web.
Hulu CEO Jason Kilar offered more positive news: Hulu is now serving 11.4 billion video streams a month according to comScore – which is a lot – and they were rolling out some exciting new video advertising formats.
But the main story here seems to be the complex relationship between Wall Street, Madison Avenue, and the global Internet. I think there’s an unspoken fear that advertising – digital advertising in particular – has some very unnerving similarities with the financial services industry. They’ve both become swamped with data. They’ve both become dominated by increasingly complex and fragmented webs of intermediaries transacting around complex information products that often seem to lose contact with tangible assets. And they’re both proponents of self-regulation and the hypothetical stability of self-organizing systems, which can collapse very quickly.
One important difference is marketing’s clarifying relationship with sales, which are of tangible value. Google endures because it’s connected fairly closely to sales, and it creates, rather than obscures, efficiency. Of course, Google is not Madison Avenue, and from Madison Avenue’s viewpoint as expressed by panelists at OMMA, Google seems to be looking more like friend than enemy at this juncture. Under duress, agencies tend to revert to extolling branding as a religion and creative (always a noun) as revelation, even as these concepts are challenged by what Nigel Morris, CEO of advertising firm Isobar, summarized as the idea of “brand as service.” But the tension is on the media side, where ad networks and Google are indeed pushing into territory formally controlled by agencies and media companies with efficiency and disintermediation. If there is another collapse in store for advertising, it seems this time the industry’s most venerable institutions are at greater risk than its young turks.
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Category: Uncategorized Tags: Add new tag, Advertising, Economics, Media
