Is the Ad Spend of Christmas Ads in Jeopardy

Investment in advertising is closely linked to the context in which companies operate. Every time there is a crisis or a period of uncertainty, the market suffers and things get complicated. Companies must make economies or begin to make adjustments to prevent before curing. Advertising is one of the first environments where they apply those adjustments and make those cuts.

You just have to think about Luxembourg Phone Number List what happened during the beginning of the coronavirus crisis. As soon as the pandemic became news and began to affect the daily lives of a large group of the population, companies canceled, frozen or reorganized their advertising budgets. Investment plummeted and all market players, even the most powerful, noticed the effects. Normal investment did not return until much later, if it did return at all.Now, a new problem – derived from the previous situation – is setting the agenda and putting advertising investment in jeopardy again. The voices that warn of this potential risk are not new and have been pointing out the potential problem since late summer.

At the end of September, experts already pointed out that the stock crisis could lead advertisers to cut back on their Christmas campaign. At the end of the day, you are not going to do massive advertising campaigns if all that avalanche of demand that you can create is not going to be backed by a solid position in the market.

You can not sell what you do not know if you are going to have.Now, closer to the strong weeks of the Christmas campaign, analysts seem to have it clearer. The manufacturers of key products in the campaigns of these months are betting on much more cautious strategies in advertising investment, analysts and executives of these industries explain to the Financial Times .

See also  Twitter: The Power Of Microblogging In Companies' Digital Marketing Strategies

For example, car brands and toy manufacturers are going to be more cautious about how much advertising they launch, because they don’t want to run into a complicated situation. Its products are stuck in ports around the world.This is happening in “a wide variety of industries and geographies,” as they noted in Snap’s results presentation. Businesses cannot respond to increased demand so they are not hitting the keys to create them. “You cannot do marketing of a product that you do not know if it will really be on the shelves,” they explain from the toy industry to the economic environment.

And this is going to have a domino effect on the advertising industry, which is still not very clear about how the drag of this crisis will affect it. The accounts of the large advertising agencies have not yet shown the effects of the situation, according to the FT , but it is to be expected that things will change. The industry will see ads go down and less marketing done. Investment is going to back off.

The type of ad that will prevail will also change in the near future. As they point out in the analysis, the advertising that will be most affected is the one based on results, that is, the one that you want to convert into direct sales. Advertising that wants to create a brand image plays in the long run and will be much less vulnerable to the market situation.

Leave a comment

Your email address will not be published. Required fields are marked *