*New Year Brings Wary Ad Forecast: According to a new report by FitchRatings, the projected contraction in output among the major advanced economies will represent the steepest decline since WWII, with GDP in the U.S. to decline approximately 1.2%, while inflation is forecast to be 2.7%. Regarding the advertising environment, the Fitch media team is more cautious than most major advertising forecasts, none of which currently predict advertising to be nearly as weak as 2001. Fitch's cautious view about advertising is, in part, supported by these underlying conditions:
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The 2001 ad downturn was concentrated in national advertising, while the 2008-2010 downturn will include both local and national components. Political and Olympic spending masked the local market weakness in 2008, and the report says the absence of these revenue sources in 2009 will expose the depth of this weakness;
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This weakness in local markets will be compounded by national advertising pressures due to the impact of the credit market events that hit while many large national advertisers were planning their 2009 ad spending budgets, forcing many companies to emphasize capital preservation and liquidity, not just earnings growth; and,
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With advertising being one of the most easily scalable fixed costs, some major advertisers could plan to pull back on national campaigns considerably until there is more visibility in the market. As the report notes, advertising inventory has proliferated (from online and emerging mediums as well as traditional ones) since previous downturns. Media companies are likely to compete more heavily on price in this downturn to fill the vast supply of ad space available. Even healthy advertisers are likely to use this increased bargaining power to command better price terms and concessions from media companies.
Source: FitchRatings
*Streaming Videos at Your Desk: A recently released report by Nielsen Online says that workdays are becoming prime time for online video viewing. The report adds that 65% of online video viewers stream content between 9 a.m. and 5 p.m., Monday through Friday, compared to 51% of online video viewers who log on between 6 a.m. and 8 p.m. on weekends. The report also includes overall online video usage and top online brands ranked by video streams for September and October 2008. In October, time per viewer increased by 10%, while the number of unique viewers and total streams remained relatively flat month-over-month.
Source: Nielsen Online, VideoCensus
*Millennials Optimistic About Future: Despite a failing economy, employment woes and countless other concerns, a key segment of Millennials remains confident about what 2009 will have in store for them. According to an omnibus survey conducted by StrategyOne on behalf of Pepsi, four out of five Millennials are hopeful about the future, and nearly all surveyed (95%) agree that it is important for them to maintain a positive outlook on life. Other findings include:
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74% find that supporting causes makes them feel more optimistic;
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77% of Millennials report having a strong sense of optimism about their careers;
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95% of Millennials make positive associations when they think of the word "change," associating it ?with "progress" (78%), "hope" (77%) and "excitement" (72%);
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67% of Millennials say that the election of Barack Obama is making them feel optimistic about the future of the country;
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Even though the study found that 95% of Millennials say it's important to maintain a positive outlook on life, 56% feel anxious about their lives now, compared with 43% of Generation Xers, 51% of Baby Boomers and 36% of postwar Americans; and,
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While 72% of Millennials report feeling concerned about the future, 97% are optimistic about some personal aspect of their lives. These levels are in line with the 79% of Americans who are concerned about the future and 98% who are optimistic about their personal lives.
Source: Pepsi Optimism Project Survey, 2008