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How Will Downturn Impact Advertising?

If the recession doesn't kill advertising, it could make it stronger

If the recession doesn't kill advertising, maybe it'll make it stronge. At any rate, that's the glass-half-full way of interpreting the results of an online poll for Adweek among members of LinkedIn.

Participants in an Adweek, SMM's sister publication, poll responded in late March and early April to the question, "How will the economic downturn most affect advertising?" Picking from a menu of choices, 22 percent of the 4,300-plus respondents said "there will be less advertising."

Eight percent said "advertisers will play it safe." But a majority said the main effect would be an evolution (of one sort or another) that makes advertising more adaptive to changing conditions: 30 percent foresee "better targeted ads to improve ROI," 23 percent anticipate that the "shift to online would accelerate" and 15 percent think "ads will follow traffic to social media." (You can click here for a LinkedIn display of the total results and breakdowns of the data by a number of categories.)

Responses from LinkedIn members who work in the marketing/advertising sector were roughly in line with those of the poll's participants in general: 29 percent expect better targeting to improve ROI, 28 percent foresee an accelerated shift to online and 14 percent see ads following traffic to social media. Eighteen percent think there will be less advertising, and 11 percent think advertisers will play it safe.

One alarming finding for the ad business comes in a breakdown of the responses by job title. The tendency to say "there will be less advertising" was higher than average among respondents identified as business owners (with 33 percent expressing this view) and among executives of the "C-level & VP" variety (29 percent). Since these are the people who tend to decide on ad budgets, their opinion could become a self-fulfilling prophecy. Given the view business owners often have of themselves as risk takers, it's not surprising that just 1 percent said they think advertisers will play it safe. Eight percent of the high-level executives (who maybe aren't such risk takers) voiced that opinion.

In a breakdown of the data by job function, there was an intriguing gap between people in "marketing" and those in "sales": The latter were much more likely than the former to choose "better targeted ads to improve ROI" (36 percent vs. 23 percent) as the recession's preeminent effect on advertising.

As you might guess, the poll's 18-24-year-olds were more likely than their elders to pick an acceleration in advertising's shift to online as the way the downturn will most affect things. Twenty-seven percent of them picked that answer, vs. 23 percent of the 25-34-year-olds, 22 percent of the 35-54s and 21 percent of those 55 and older. But the youngest group wasn't significantly more likely than the eldest to see a shift toward social media as the downturn's principal effect on advertising.

There was a gender gap in the responses, but it was concentrated around two of the answers participants could pick. Men were more likely than women to choose "there will be less advertising" (25 percent vs. 18 percent); women were more likely than men to pick "ads will follow traffic to social media" (18 percent vs. 13 percent).

Source: Adweek