In 2023, companies in the ad ecosystem tightened its budgets and laid off staff. But did they need to?
“No,” says Brian Wieser, founder of the consultancy Madison and Wall, on The Big Story. “In my opinion, the industry talked itself into a downturn.”
Wieser’s own forecast predicts 8% growth in Q4 of this year, and 4% to 5% growth in 2024.
On this week’s podcast, Wieser talks through his predictions in the retail media space, TV and ad-supported journalism.
With its $42 billion share in 2023, Amazon dominates in retail media spend. And the company holds a unique advantage with small businesses with $100,000 to $200,000 in revenue, Wieser says.
Just as small businesses may spend only on Google and Facebook for their search and social budgets due to time constraints, small retail businesses may focus their limited resources on Amazon, since it makes up a big chunk of sales.
TV is facing a 9% decline in national TV in business this year. But it’s also going through a painful transition, since streaming offers a lower margin than their traditional over-the-air broadcasts. (It’s expensive to pay for streaming servers.) The latest carriage deal kerfuffle between Charter Communications and Disney (good luck watching ESPN on Spectrum right now) shows how dramatically the world has shifted, says Wieser, a former cable analyst.
“The way that Charter called out how they are at the point of indifference – that’s a really critical word,” he says. “It’s better to be loved or hated than to be indifferent.”
Finally, the plight of journalism (which we are not indifferent about) is in the middle of a “flywheel from hell,” writes Managing Editor Allison Schiff. A lack of investment prompts a decrease in audience and engagement, which prompts even less investment – and the flywheel continues.
“The best way forward for journalism may be to skip over advertising and focus tightly on building subscriptions,” Wieser says. “Anyone who can figure out a way to build a subscription business is going to be way better positioned.”
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