Fast Forward

Sir Martin Sorrell gives an interview to the Wall Street Journal and the advertising industry shudders. He’s still bearish on the industry, even though some executives are seeing light at the end of the tunnel.

Another train coming perhaps?

The WPP chief says that even though advertising and media executives “feel better”, that “hasn’t translated itself into people getting confident enough to be able to increase their investment in brands.”

Seems some executives have been getting starry-eyed from the improvement in what industry people call the “comps”, meaning the year-to-year comparisons. They have been trending upward somewhat following a devastating period.
Sir Martin admits “we were too optimistic.” WPP saw its profits for the first half of 2009 plunge by nearly 50 percent.

“We describe the recession as L-shaped, which implies that it will never go back to where it was before,” Sorrell told the WSJ. “The forecast for levels of increase in ad spending, both traditional and nontraditional, are pretty anemic for the next two or three years.”

In retrospect, Sir Martin said WPP should probably have moved more quickly when signs of a recession were in the air.

Brand Names Tumble

People worldwide have lost some trust in the 100 top brands – especially those hard hit by the recession, such as financial services and automobiles. However, the two top brands last year, Coca-Cola and IBM, kept their places this year, actually gaining value.

This is according to an annual survey by Interbrand, part of the Omnicom Group. It was the first time in 10 years that the top brands fell in relation to previous year. The total brand value of $1.15 trillion was down 4.6 per cent from the previous survey.

Six of the top 10 brands, including Microsoft, General Electric, Nokia and Toyota, lost value.

Among the four brands gaining value, Google had the biggest jump, up 25 percent, which lifted it to seventh place, from 10th. The survey assessed brand value from July 1, 2008, through June 30, 2009.

Financial companies took the hardest blows. American Express fell to No. 22, from No. 15. Citi declined to 36, from 19. UBS toppled to 72, from 41. 

Of the top 10 brands, the first five finished in the same order as they did last time:

1.    Coca-Cola.
2.    I.B.M.
3.    Microsoft.
4.    G.E.
5.    Nokia.

Both Coke and I.B.M. gained in value and the other three declined.

Here are the remaining five brands in the top 10 and their previous ranks:
6. McDonald’s, previously 8;
7. Google, previously 10;
8. Toyota, previously 6;
9. Intel, previously 7; and
10. Walt Disney, previously 9.
Of those five, McDonald’s and Google gained in value and the other three declined.

Online Video Trend is Up

The latest research from ComScore shows that half of America watched online video in a single month. That’s 158 million viewers. Whether it’s the United States or Ukraine, the trend is away from traditional television and toward online viewing.

What worries television executives is when people watch online videos. If it’s at work, it might upset the boss, but if it is in traditional television time (before and after work), then there is cause for television to be seriously worried.

Predictably, most viewing, according to ComScore, 27.3 percent of all the minutes spent watchingoccurred Monday through Friday between 10 a.m. and 5 p.m.

However, morning and late night online viewing is growing fast. Total minutes of video watched between 7 a.m. and 10 a.m. increased 171 percent in the last year, compared with a 123 percent increase for daytime. Meanwhile, late fringe, 11 p.m. to 1 a.m., grew 162 percent and late night, 1a.m. to 7 a.m., grew 205 percent.

What does this mean? This could impact some of the late night and early morning network franchises in those viewing slots. However, prime time traditional TV seems to be holding its audiences against web video, with web video actually falling a few points in minutes watched.