It is always darkest before the dawn

It is my little brother’s birthday today – so happy birthday Scott. Not that either of us is so little anymore. But I think it is important to celebrate another year of orbiting the sun. On the other hand, when you look at the trade media for marketing, media and advertising there is not much to celebrate.

Budget cuts, job losses, and an endless line of opinion pieces touting everything from “What we can learn from….” to why it is “The end of the world as we know it because…”

I almost didn’t write this WOW newsletter this week, because to be honest, instead of WOW! I was left feeling more like WOE!

So, if like me, you are feeling like you would rather be celebrating than commiserating, stop reading now.

Otherwise, this is what made me go WOW! this week in marketing, media and advertising.

MARKETING, MEDIA AND ADVERTISING JOBS PLUMMET AS COVID-19 BITES

Jobs advertised across Australia’s marketing and communications industry fell by nearly 61 per cent between April and May, according to new figures from Seek.

The recruitment and employment site noted jobs in the marketing and communications category fell 60.9 per cent between April and May 2020, while roles in the advertising, arts and media category also plummeted by 60.5 per cent over the same period. These two professional sectors were in the top eight job categories to experience the most dramatic drops in jobs being advertised as a result of the COVID-19 pandemic.

But it is not just Australia - this is a pandemic, and new figures from Ad Age show that US agencies and other communications companies (including PR) cut 36,400 jobs in April as Covid-19 struck, down 7.5 per cent. Hardly surprising as up to 20 million jobs across the US have been lost so far.

WHILE SUMMER IS COMING IN THE NORTH, THE AD SPEND FREEZE WILL LAST AT LEAST 6 MONTHS

Large global brands are to cut ad spend harder – and for longer – in response to the coronavirus pandemic, according to fresh research from the World Federation of Advertisers (WFA).

89% of large multinational companies have deferred marketing campaigns this month, up from 81% in March, found data from the trade body’s Covid-19 response tracker.

52% of marketers at these companies said they’ll now hold back ad spend for six months or more, compared to just 19% who mulled taking similar medium-term action last month.

THE BUSINESS SECTORS HIT THE MOST BY THE PANDEMIC, AND THOSE FARING BETTER... FOR NOW

Major U.S.-based advertising holding company Omnicom Group said Tuesday that some sectors including travel and entertainment and energy are cutting costs, including postponing or reducing marketing spend, due to the impacts of the coronavirus pandemic. But other sectors are doing better — for now. 

The company said sectors like travel, lodging and entertainment; energy and oil and gas; nonessential retail; and automotive have been more immediately impacted by the pandemic and are already postponing or reducing marketing spend.

Meanwhile, health care and pharmaceuticals, technology and telecommunications, financial services and consumer products have fared better so far, the company said. But it noted that demand for marketing services will likely decline as advertisers cut costs short-term because of economic uncertainty. 

GET THE COMPLETE IMPACT ON MARKETING, ECOMMERCE & ADVERTISING HERE

The ongoing coronavirus pandemic is impacting every part of our lives, from the places we can go to the way we spend our time, to the priorities we have and the way we spend our money.

Of course, this has wide-ranging ramifications for marketing, advertising and ecommerce – as well as a number of other sectors like travel, entertainment and FMCG.

FINANCIAL MARKETS SCORE WPP AT 'BBB+'; OUTLOOK NEGATIVE

Fitch Ratings has affirmed WPP's Long-Term Issuer Default Rating (IDR) at 'BBB+'. The outlook is negative. The affirmation reflects the signs of recovering revenue and improved operating trends at WPP prior to the COVID-19 crisis and associated lock-downs globally. Pandemic response initiatives taken by management are intended to preserve margins and conserve cash flow in what will be a tangibly weakened 2020 revenue environment. The company faces the impact of the pandemic with having made progress in its recovery plan and a strengthened balance sheet.

ALL OF ADVERTISING’S MAJOR HOLDING COMPANIES ARE SUFFERING

All of the major holding companies in advertising, bar Dentsu, have now updated the market on their performances in the first corona-hit quarter of 2020. Here’s what you need to know. Down. Down. Down.

BUT PUBLICIS GROUPE FIGHTS COVID-19 DOWNTURN WITH MONEY BACK ‘THE PACT’ OFFER

The ever-ingenious Arthur Sadoun at Publicis has produced a new wheeze for these straitened times: money back for clients if Publicis doesn’t deliver “guaranteed outcomes” via its new The Pact service for mid-sized clients. Mid-sized being a pretty wide definition: $10m – $1bn. The spending limit (you knew there’d be a catch) is $25,000 per month for a minimum of three consecutive months. The Pact is powered by Publicis’ new Epsilon data marketing subsidiary and Publicis Media and claims to track and assign more than 200 million customer IDs across all devices to boost visitor traffic and sales.

NOW COMPARE AND CONTRAST THE FUTURE FROM TWO AGENCY LEADERS

While it’s hard to foresee the company’s full-year performance at this point in the pandemic, Omnicom CEO John Wren said Tuesday one thing is clear: “Every aspect of our business is going to change” coming out of the crisis.

That’s part of the reason Wren has established committees on media, advertising and public relations to evaluate future business models for those sectors. “I’m looking for dramatic answers and goals and objectives to accomplish,” said Wren, on how those businesses should be performing in the future.

Meanwhile, Sir Martin Sorrell was back to his rabble-rousing best over the weekend, telling media that CV-19 would put an end to a number of inefficient businesses in what he described as a “Darwinian culling”.

The former WPP supremo and now CEO of his latest venture, S4, believed only the strongest companies would pull through the global pandemic in a survival-of-the-fittest fight that he compared to Charles Darwin’s theory of natural selection.

For the past ten weeks, my colleague and friend, Stephan Argent at Listenmore in Toronto, Canada has been quoting Sir Winston Churchill in a weekly column on his website – KBO – Keep Buggering On! It is worth a read and just the tonic for woe. Check it out.

As always, if any of this has piqued your curiosity or you simply want a more confidential discussion on any topic and the marketing implications and advertising opportunities let me know.

And stay safe, healthy and sane. It is always darkest before the dawn.

Cheers

Darren