Advertising in Europe Softens, and More Goes to the Internet

Advertising in Europe Softens, and More Goes to the Internet

Now, they and the media owners who rely on their business are worried that European marketers will slash ad budgets, as many of their counterparts have already done in America.

“Definitely, if our clients suffer from higher petrol costs, spending is going to be affected,” said Valérie Accary, president of CLM/BBDO, an agency based in Paris owned by the Omnicom Group. “So far we haven’t seen it, but the second half is a big concern.”

ZenithOptimedia, a media buying agency that is part of Publicis Groupe, recently downgraded its forecast for ad spending in Western Europe, saying it would grow by 3.7 percent this year — barely more than the inflation rate. That is still better than the 3.5 percent growth expected in North America, but a reduction of two-tenths of a percentage point from the previous forecast, issued only three months earlier.

That may not seem like a large revision. But the new numbers mask bigger shifts in spending, as advertisers allocate more of their budgets to the Internet, cutting their allocations to broadcast and print advertising.

“If you’re in some of the traditional media in Western Europe, you’re not going to see much growth over the next year or so,” said Jonathan Barnard, head of publications at ZenithOptimedia in London.

Among the big European markets, analysts say Britain and Spain may be most at risk, as their economies slow sharply in response to housing slumps. France and Italy are also showing softness, while Germany is holding up after a wobble early this year.

For some individual media owners, feeling the combined effects of the shift to the Internet and the economic downturn, an ad recession has already arrived. Trinity Mirror, a British newspaper publisher, said last month that advertising had fallen 12.6 percent in May and June.

Analysts at Citigroup issued a warning last week about advertising prospects for several big European television broadcasters, including ITV in Britain and ProSiebenSat.1 in Germany.

While some analysts had speculated that marketers would reduce spending on the Internet in a downturn, deeming it experimental and nonessential, the opposite seems to be happening. In Britain, for instance, Internet ad spending will rise 32 percent this year, according to ZenithOptimedia, a sharp revision from the agency’s previous prediction of a 26 percent gain.

Internet advertising is benefiting because it allows marketers to track the effects of their spending, something that is more difficult to do in other media. Agencies that create advertising, like CLM/BBDO, are feeling the effect.

“Clients are saying, ‘We don’t want big ideas, big projects,’ ” Ms. Accary said. “It’s about messages that are effective and right to the point.”

NBC: Online Olympics Nearly Sold Out. What Does That Mean?

from Silicon Alley Insider by Michael Learmonth

NBC U tells Mediaweek ad sales are going pretty well for the Beijing Olympics. Four weeks before the start of the games, NBC says 85% of the ad inventory onNBCOlympics.com is sold.

It's unclear if this includes the NBC video programming that Micrsoft's MSN will carry. But either way, it's a bit of a meaningless claim, since NBC really doesn't know how many people will end up tuning in, and thus how much inventory it will have to sell. NBC's hope: like CBS's March Madness, there will be significant at-work viewing because events scheduled in the evening in Beijing will unfold during work hours on the East Coast...

NBC And Online Olympic Ad Sales: 85 Percent Sold Out

from paidContent.org by David Kaplan

NBC Universal (NYSE: GE) says advertising inventory for the roughly 2,200 hours of online Olympics coverage next month is about 85 percent sold out, according to tells Mediaweek. Although many popular events—like swimming (Gold Medal finals), volleyball, boxing, track and field and gymnastics —won't be streamed live, Zach Chapman, director, digital sales for NBC Sports and Olympics, is convinced that office workers will be glued to NBCOlympics.com, its dedicated site for showing the Beijing games, which begins on August 8th.

Due to International Olympic Committee rules limiting the amount of marketing during the games, advertisers will run pre- and mid-roll video spots of 15 or 30 seconds— but no overlays. To make up for that, NBCU is working with marketers on customized spots. One example: a Hilton-sponsored video recap called "While You Were Sleeping," which should help given the 12-hour time difference between the east coast and China. NBCU has also collaborated with Hilton on an online trip-planning section called "Destination Beijing" on NBCOlympics.com that uses the hotelier's web-based booking tool...