New Year’s Greetings from BIA/Kelsey

So, the good news.

2009 is over. Thank God.

We head into the New Year severely chastened by the historic revenue declines of the current one. The numbers for 2009 don’t bear repeating. They were several shades of awful.

There are signs of a modest ad economy recovery as we enter January 2010. The broadcast networks are reporting an active scatter market. This makes the network execs that decided to hold back inventory at the upfront look like good market callers. Some of the larger radio groups are reporting a decent December assuming that flat is the new up! Online ad activity is regaining its health as well after a down year on the display side.

The American consumer seems to have provided the retail community some good news in the recently concluded holiday shopping season. The longer term outlook on consumer spending seems a little mixed but let’s take the good news for what it is.

We’re also coming up against weakened 2009 comps but that’s a mix of good and bad news. So, upward pacing cheers will be balanced by the knowledge that these positive pacings are for revenues more reminiscent of the late 1990’s. Depressed ad rates could be bolstered by some advance in demand but how much remains a mystery. Advertisers are still wary of the economy as unemployment will remain high for a while, and that will likely mean any advertising rate increases are going to be the result of some intense negotiation. That won’t be a change from 2009!

A lot of businesses large and small decided to cut back and/or sit out advertising in 2009 but it seems that more positive psychological changes are present in this community. Business owners know that they need to re-invite consumers through advertising campaigns into their showrooms in order to generate sales. The survivors of the Great Recession need to let consumers know they’re still around. There’s still business to be had but it will need to be seduced in no small part by solid and effective advertising. Can your current sales operation make that happen?

There’s some optimism for 2010 revenues as the nation prepares for its first mid-term election during the Obama presidency. Given the tenor of recent legislative battles in the halls of Congress, increased citizen advocacy, some historically poor poll numbers for this particular Congress plus an economy that is still in turmoil, this coming mid-term election is red hot and looking very competitive nearly everywhere across the country. With all 435 House seats, more than a third of the Senate and Gubernatorial races in states like California, Texas, Florida, New York, Illinois, Pennsylvania and Ohio, it’s a big, big year. This has generated the usual estimates of billions of political dollars in play spread out over several early year primaries and the November election. This is great news to parts of the media business that have seen more than its share of suffering this year. If true, these projections can put a big 2010 Band Aid on a business that needed a tourniquet in 2009.

But what about 2011 when all that political money disappears and we’re back to the normal advertising marketplace? It would seem that the additional revenue in 2010 is a perfect opportunity for traditional media companies to address their shortcomings on the sales side of the industry with both the traditional and digital sides. If you’re not happy with the ups and downs of the odd-even year symphony that’s become our business, perhaps 2010 is the convenient time to address that. The best time to fix the roof is when the sun is shining!

There is an opportunity in local media markets for someone to unlock the mysteries of the new advertising universe to businesses in pursuit of customers. With all the new advertising opportunities available in the market today, advertisers are confused on how these can help their businesses grow. A number of advertisers were confused about the traditional media choices, too. As to this new mission, no one is quite there yet. Those who get there first and show meaningful and sustained results will be the winners of a large share of local ad dollars. The question for media companies is: are you going to be the first or let a competitor get there before you? With self serve advertising options now becoming more commonplace, it will be up to local sales staffs to add value and results to ad campaigns. Otherwise, local merchants will have the ability to do the work for themselves! Not a pleasing prospect.

A recent study from the ANA and b2b Magazine shows that 2/3rds of marketers have added social media (Facebook, LinkedIn, Twitter, etc.) to their overall media mix. Where is the budget from that coming: traditional media budgets. Only 26% of marketers indicated that they’d established a separate social media budget that didn’t come from the traditional media side of the ledger. How long before your clients do the same? The word of the day for marketers is flexibility. “As more media platforms become available, it is imperative that all marketers continue to assess their capabilities and select the platforms that are best suited to help them meet their brand’s goals and objectives,” said Bob Liodice, president and CEO of the ANA. “With this proliferation of media, marketers must work harder, survey the entire landscape available to them and create their brand’s most optimal media mix.” Hard to argue with that but can anyone explain this to local marketers? It’s time for local media sellers to step into that gap.

While we’ve all had our share of advertising agency adventures over the years, the simple fact is that your sales staffs are going to have to take more of that platform agnostic mentality to effectively service direct local clients. The days of a single platform sale will become less common as we move into the digital age. Our local sellers are going to have to be able to construct ad campaigns that make multiple platforms work effectively in some synchronicity.

Have you given your sellers the proper training to ask the right questions so they get critical data from clients and prospects to make that happen? Do you have the resources necessary to help the seller navigate the creative elements of an ad campaign that makes the difference between an effective campaign and one that isn’t? If you can’t answer either question in the affirmative, the time to act maybe right in front of you. If you can’t, then now will be the time to reinvest in that sales training. It’s not easy to commit significant resources coming off a year full of down revenues and massive layoffs but what’s the price of not making the investment?

Best wishes for a successful 2010 and beyond!

Tags: Advertising, ANA, b2b Magazine, broadcast networks, Facebook, LinkedIn, revenue, social media, Twitter

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