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General Category => General Discussion => Topic started by: chrispy on March 30, 2020, 05:51:52 AM

Title: Ad Revenue
Post by: chrispy on March 30, 2020, 05:51:52 AM
I heard last night from a family member who is in the C-suite of a major digital media company that they will be laying off many folks this week.  Their content has never had so many eyeballs but no one is purchasing ad space.
Title: Re: Ad Revenue
Post by: Schwab711 on March 30, 2020, 06:46:16 AM
Thanks for the anecdote. Fits with what the ad-dependent tech companies are saying.

I believe FB's update implied Y/Y revenue growth will be negative in 2Q20


US ad spending has generally been between 1% and 1.4% (mean = 1.3%) of GDP.
https://www.bloomberg.com/news/articles/2014-03-03/advertisings-century-of-flat-line-growth

In 2018, it was roughly 1.2%
https://www.fticonsulting.com/about/newsroom/press-releases/fti-consulting-forecasts-digital-ad-spending-will-overtake-broadcast-this-year


We are probably going to see a decline in advertising spending that will be hard to picture. Both GDP/revenue are declining along with business confidence declines. Wouldn't be shocked if some ad-dependent companies see ~50% declines in revenue, despite record eyeballs.
Title: Re: Ad Revenue
Post by: alwaysdrawing on March 30, 2020, 07:11:41 AM
I'm seeing anecdotal evidence that ad rates are down 50%+ on Facebook already.

I believe both revenue and profits are in for a significant decline at the major ad firms (Google, Facebook, but also TTD and others).
Title: Re: Ad Revenue
Post by: HJ on March 30, 2020, 07:21:51 AM
Not surprising if you think about the major advertising categories:
Travel / leisure
Consumer finance (credit cards / auto insurance / mortgages)
Local (restaurants, car dealers)

The only category that holds up is probably healthcare/consumer products.  Even political ads seem to be drowned out by the virus news.
Title: Re: Ad Revenue
Post by: merkhet on March 30, 2020, 08:34:06 AM
Not surprising if you think about the major advertising categories:
Travel / leisure
Consumer finance (credit cards / auto insurance / mortgages)
Local (restaurants, car dealers)

The only category that holds up is probably healthcare/consumer products.  Even political ads seem to be drowned out by the virus news.

Political ads also depend on their ability to fundraise, and they hadn't seemed to have kicked into high gear yet prior to the COVID situation -- so I wouldn't be surprised if they are leaning more on their direct mail lists as people have less money to contribute. I have a friend who is a Congresswoman, and I'm seeing a heck of a lot more e-mails from her campaign lately.