🥱 Tired of Ads? It’s Going to Get Worse.
Media is in deep trouble. Everyone will start schilling.
This is The Level Ups. Modern business news for the future business leader (in plain-Jane English).
- Media winter is upon us.
- Influencers might want to play nice.
- How your business can take advantage.
Let’s get into it.
Estimated reading time: 3 minutes & 3 seconds
What’s the first thing to get cut during a recession? Marketing.
Don’t take it from me. Take it from all the brands cutting their advertising budgets.
Former CNN personality put it best in his recent essay in The Atlantic.
The advertising marketplace is softening. Economic headwinds are worsening. Shareholder demands are unforgiving.
How can we be sure that ad budgets are shrinking? The establishment media that depends on those ads is laying off staff. Times are tough indeed.
- CNN cut 200+ jobs.
- Gannett, (owns USA Today and several local papers, cut ~200 jobs, ~6% of news staff.
- Paramount Global laid off ~30 employees (small number, big deal).
- NPR is cutting $10m+ from its budget and freezing hiring.
- New York Times staff have threatened to strike if they don’t get better wages.
Another reason we don't talk about enough: all that free crypto money is mostly gone.
Digital Is No Different:
Take Google. All they do is drop ads on their properties.
I Googled “how to level up” (as per the name of this newsletter), and the first result was an article (that was ok at best), just littered with ads.
Aside from learning that my competition is not as good as expected (I should promote more), I saw how desperate Google is.
Look at this post. Reminder: this is the first result on Google.
Everything on the top and the right is an ad. There was a pop-up too. It’s getting ugly.
Influencers May Want to Play Nice
Influencer marketing budgets are usually safe from cuts like this. Why?
Because they have advantages in the marketing game.
- Their audiences choose to hear from them (I didn’t choose those ugly display ads).
- It’s an intimate relationship with the audience (people feel like part of the influencer’s life, in many cases).
- Influencers understand their audience and create more compelling ads than many marketing teams.
But even they’re not safe. Well, most of them aren’t.
The influencers who are in the 10M+ audience size world are fine. It’s everyone below them that’s facing challenges.
- Crypto money is gone.
- Ad budgets are cut.
- If brands are going to spend on influencers, the “sure thing” is usually a safer bet.
Your friend with 50k followers on IG probably won’t make as much in 2023. If this made you feel better, you’re a terrible person.
Jokes aside. Experts weighed in, and it looks like Creators need to brace for their own recession.
But let’s talk less about them and more about you.
How Your Business Can Take Advantage
Lock up your distribution now.
Even in a recession, you can’t play defence forever. Things will turn around. You’ll want to take the lead before your competitors do.
Media brands and some influencers are strapped for cash. Negotiate better deals for less money (over more extended periods).
Instead of paying per post, do a deal for several months (if not years) at a time. This way, you’ll pay less per post on average, but it’ll feel like a steal when things turn around.
- Airport distribution. Companies that locked up ad space during COVID at discounted rates are enjoying the travel boom today (think of how many people are seeing those ads now).
- Retail ad-Long-termscash flowpace. Same idea. COVID was brutal, so the ads were cheap. Long-term commitments help them with cash flow and turn into better ROI when things turn around.
Now, replace COVID with RECESSION and do the same.
Who’s hit hardest during the recession?
- The establishment media we just talked about.
- Same with micro influencers.
- Anybody who used to sell crypto ads (half-joking, but I doubt they expected it to dry up like that).
Desperation makes people market whatever they can. Just wait and see. Schilling season starts in January.
Go to these people for advertising, talk about a long-term deal, and watch them drop their rates.
Speak to more than one party. Give yourself options while they’re fighting for whatever they can get.
You’ll get a better deal.
Let me know if any questions.
Thanks for reading!
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