Advertising and PR agencies have lost 65,000 jobs, or about 14 percent of the pre-recession total. Moody’s Analytics estimates our industrywill lose even more within five years.
Federal Reserve Chairman Ben Bernanke calls it “the worst financial crisis in modern history.” His predecessor, Alan Greenspan, says it was “the most virulent global financial crisis ever.” The resulting recession was longer and deeper than any the U.S. has suffered since World War II.
On hopefully the heels of The Great Recession, my good friend, David Deal sent me the new sixth annual Razorfish Outlook Report 2010, it suggests the economic recession is subsiding.
“For this year’s report, we examined the data differently to acknowledge the new realities the Great Recession presented our clients and us,” said Jeremy Lockhorn, VP of emerging media. “We analyzed how our clients adapted to the challenging environment, what media proved effective, what didn’t deliver as expected, and how this information can be used to direct successful strategy moving forward.”
The report explores the effect last year’s down economy had on media consumption and client spending. The report predicts mobile and social media marketing will become key parts of clients’ media budgets. Among the findings:
- There was a recovery in spending in 2009 over 2008, albeit a small one. The average client media spend increased 4% in 2009, as opposed to decreasing 13% in 2008.
- Contrary to popular belief, not every brand shifted its advertising focus to direct response as a result of reduced consumer spending. In fact, 60% of clients who did switch the approach of their ads actually moved to a more brand-focused message.
- Clients continued to experiment with new media. Digital out-of-home in particular experienced significant growth, along with ad exchanges, data brokers and social media.
- Social media, which has exploded in popularity over the past few years, still only garners 4% of average client media spend. However, much of the cost of social media comes in the form of labor, not ad space – an important distinction when analyzing and planning media budgets.
This report also highlights other media trends, which are currently not getting as much attention as mobile and social, but will still have an impact in 2010, this year’s Razorfish Outlook Report can be viewed in its entirety online at http://razorfishoutlook.razorfish.com
Quick Ad Agency TwtPoll: Is your agency’s business up, down or about the same from 2009? Click Here
Additional articles that may be of interest:
- Ad Agency CEOs: Social Media Philosophy and Tips for New Business
- Ad Agency Blog of the Month: JaneNation.com
- Twitter Usage In America: 2010 Study and Ad Agency New Business
- JetBlue tests the social media credibility of ad agencies vying for its account
