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Kirby Winfield is Chief Revenue Officer of Mpire, makers of the first and only transparent campaign verification technology, AdXpose. Winfield is a seasoned media executive who has seen many market peaks and valleys during his 13 years in online advertising – and lived to tell about it.

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Are Top Brands Canceling Christmas? Not a Chance!

Written on
Nov 13, 2008 
Author
Kirby Winfield  |
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Are Top Brands Canceling Christmas? Not a Chance!

brand_keyworkds_small.jpgADOTAS EXCLUSIVE — Apparently, there’s a minor hiccup happening in online advertising. And in the global economy at large. Don’t just take my word for it; I am sure most of you can’t spend five minutes updating your fantasy football teams or reading DailyCandy without being interrupted by the latest email or Slideshare featuring Silicon Valley, Wall Street and Madison Avenue’s finest predicting the End of Days.

Sure, there’s a recession on. But spend enough time listening to the talking heads and you’d think Americans had overnight (against years of proof to the contrary) become fiscally responsible to the point of canceling Christmas.

Not so. One thing you can count on is Santa. He may show up late, maybe a bit grumpy, but he still shows. So while consumer spending in general, and considered purchases (higher ticket items) specifically, will pale in comparison to recent years, brands are not going to respond by taking their (metaphorical) balls and going home.
“It’s the impulse purchase and the self-purchase that’s going to suffer this holiday,” said Marshal Cohen, chief industry analyst at NPD Group, in the New York Times yesterday. Notice he didn’t mention GIFTS.
The Times article continued: “Retailers, worried about grabbing the few dollars consumers are willing to part with, will be offering the kind of discounts usually only seen in the days leading up to Christmas. “I think electronics are going to go through an early promotional period,” Mr. Cohen said. “We’ll be lucky to get through October without aggressive promotions.”
PROMOTIONS? Sounds like advertising to me!

In fact, indications from comparison shopping engines (CSEs) and ad networks so far this quarter are that retail advertisers may spend relatively aggressively in Q4 during the down economical cycle, the better to capture a meaningful share of a shrinking revenue pie. Only one shopping engine (who will remain nameless) has lowered CPCs going into the quarter. And traditional holiday spenders do not appear to be pulling campaigns.

In fact, a new Epsilon CMO Survey shows digital ad spend is increasing at the expense of traditional. Sixty-three percent of the 175 marketing execs they surveyed see an increase in their spending on online media while 59 percent see a decrease in traditional marketing spend.

At WidgetBucks, where eCPMs across our network have doubled since August, we’re seeing a strong advertiser appetite for hard-to-reach Long Tail traffic. Further, the click-through rates on our shopping ad widgets have jumped 33 percent in October compared to last month, showing that consumers continue to be engaged when offered products they want.

As has been widely noted, most recently by Pubmatic, advertisers in general have been sitting on the sidelines for two quarters, and with a grim 2009 looming large, the impetus is there for marketers to spend budget now and get results to leverage against 2009 plans.

The fundamentals of the internet media market are still sound. Consumers are still migrating usage time from offline to online engagement, and spending online versus offline as well. Dynamic Logic says consumers are more accepting than ever of “over-content” ads (pop-ups, hovers and the like). Video advertising and content consumption online continues to skyrocket, while display remains prominent and search continues to grow (PWC Global Entertainment and Media Outlook 2008-2012).
So while it may be easy to get sucked into the doom and gloom, don’t be surprised if we all experience a decent holiday season!





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