Big company or small: Advertising at a crossroads

That photo? An explanation is coming, I promise.

But first an observation.

I always follow the deliberations at the annual Cannes Lions Festival. It’s an opulent, sun-drenched gathering of advertisers, marketers, and creatives but it also usually unearths some important themes and trends.

This year, one quote stuck out for me. A television advertising exec from RTL AdConnect said that it was time for his industry to turn the tide against digital advertising. He said it was time for “the empire to strike back.”

It was a great tagline that thundered throughout the festival, but in reality it was a symbol of the total desperation gripping the advertising industry.

Claiming the TV ad world would strike back is like spitting into a hurricane.

Internet advertising is set to cross the 50 percent milestone as a proportion of global ad spend for the first time and the future is digital — internet advertising will account for 52% of total ad spend in 2021 – up from just 44 percent in 2018.

Advertising at a crossroads

There are other signs of cataclysmic changes in the advertising industry as traditional ad channels like TV, radio, and print dry up and digital becomes more crowded and expensive.

Another story out of Cannes was that big brands were pressuring Netflix to accept advertising. But whole reason people pay for a streaming service is to avoid the ads! One more sign of desperation in the business.

A study showed that Netflix will lose about 23 percent of its subscribers if it accepted ads. And yet at least one analyst claims there is no way for Netflix to make money unless it goes this route.

Something has to give. Advertisers have to find a place to put their money. What are the emerging bright spots?

• TikTok — The youth-oriented video channel is promising yet a potential spy tool of the Chinese government.
• Podcasts — Creating audio content has become an “eight figure” ad business  for The New York Times. Research shows that advertising on podcasts is booming and one of the few places where ads are “accepted” by consumers.
• Games — Multi-player juggernaut Fortnite is starting to work advertisers like Nike into its platform.

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Illustrations courtesy Unsplash.com