This first appeared in the AdNews Annual 2020. Subscribe here to make sure you get your copy.
AdNews asked industry leaders their perspective on the year that was and the prospects for the road ahead:
John Broome, CEO, AANA
This year we got to know each other like never before. Quite intimately, in fact. The combination of Zoom and WFH exposed the real us. I’ve found it fascinating. But for others it’s been just too scary.
Many were quick to dash down to Ikea to invest in well positioned aspidistras or a trendy lamp. Not for me. Many fellow Zoomers have commented on the endless rows of books behind me. Call me a sucker for long-form content but I love books, particularly modern history. History is a sanity check. It allows us to look to the future through the lens of the past.
As much as we like to think we live “in unprecedented times” we do not. For example, Spanish Flu killed more than 50 million people in a single year. So my first comment about next year is a pessimistic one. A vaccine will create hope but little else. In fact, it will lead to confusion. If you think the entire world is going to form an orderly queue to be vaccinated think again. It will be messy and chaotic. So if you are basing a marketing plan on vaccine availability, I would also think again.
But what history shows us is that humans and their economies are amazingly resilient. Adversity always drives rapid innovation and creative mindsets. It accelerates new patterns of behaviour. We’ve already seen how ecommerce behaviour has been transformed. Some categories will thrive. Just ask Gerry Harvey.
Others will inevitably bounce back as dormant categories and sectors re-emerge. However, be careful to distinguish what is artificial (driven by short-term government stimulus) and what is underlying and organic. But the good news is that economic recessions are getting shorter and recoveries faster.
Advertising spend will continue to recover but its trajectory will be a function of GDP growth in turn heavily influenced by consumer sentiment, unemployment and house prices. All are more reliable barometers than the next CMO survey of intentions or the pundits talking up media spend. Much of the latter is self-serving. History tells us (or at least a study by Tellis & Tellis does) that there is high elasticity between GDP and advertising expenditure. But with GDP growth not expected to turn positive until well into next year, the boom times may take a little while to arrive.
But what about the industry itself? Let’s hope the hardest hit channels, particularly cinema and outdoor get a golden run, but digital will still lead growth in absolute terms. Marketers must resist the temptation to focus heavily on a couple of channels. All the empirical studies show that
marketers need a range to meet their business goals. Reaching all potential buyers and driving active attention across as many channels as you can afford still applies. Will we see an explosion in marketers combining their first-party data with media vendors’ data? I hope so. Subject to privacy and security, “mass targeting” will be a major industry
development assuming it all makes sense commercially. However, transparency and data access will be critical for marketers to build confidence and trust, and agencies and intermediaries who genuinely provide this will gain advantage over those who do not.
Finally, what will matter for the AANA next year? 2021 will be a big year. Firstly, we will be broadening our membership to include small and medium advertisers as well as individuals. We are keen to broaden our industry representation and to build a professional marketing community. Secondly, we have been very encouraged by our first year of offering marketing capability and training “by marketers for marketers”. We will expand our program offering next year in response to what members are telling us they want. Thirdly, global advances in cross media measurement and transparency in the ad tech supply chain will present options for us to pursue in Australia. Fourthly, we will be publishing best practice guidelines in agency pitching in partnership with the MFA. Our aim is to make it a fair and effective process for all participants. Last, but certainly not least, we have been working hard to make sure our advertising self-regulation system is recession proofed by optimising its operations and encouraging more advertisers to participate. Protecting our rights and freedoms to market our brands responsibly is important for all of us and I encourage you to get involved. Do not assume it will continue to exist without your support. It will not. It needs you. Sign up or risk losing it.
Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at adnews@yaffa.com.au
Sign up to the AdNews newsletter, like us on Facebook or follow us on Twitter for breaking stories and campaigns throughout the day.