Does This Spell Doom for Your Marketing Budget?

Snap, Twitter, Meta, and other social media networks recently reported poor quarterly results. Some pundits say this signals a slowdown. But does their poor performance point to the beginning of the end for marketing budgets? Or is it just another shift in where the money will go, asks Robert Rose of the Content Marketing Institute.

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Aired: August 12, 2022

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Well, it’s earnings season among all the places where we spend our money as marketers. And if you’ve been paying attention, you might be a little worried. Snap, Twitter, Meta, and others are facing headwinds with poor quarterly results – and this has renewed implications of a broader slowdown in marketing spend. But is it? Is it really the beginning of the end – or is it just another shift in where our money is going? This is the news you need to lead in content marketing.

Hello everybody, Robert Rose here with the news. It’s what’s new – but, more importantly, what’s important in the world of content marketing and content strategy. (For the best in best practices, you can always go to contentmarketinginstitute.com.)

So, the last couple of weeks have been earnings week for many online social platforms and digital advertising juggernauts – including Meta, Google, Snap, Twitter, and even Microsoft, which, of course, owns LinkedIn.

If you listen to many of the pundits out there, the expectation is that marketing and advertising spending is due for a very big correction. Many of the comments in the media say something like this Wall Street Journal subhead that says “digital ad spending is usually first to be cut during a slowdown, observers say.”

My question is, “Who are these observers?” Because that’s just not even a little bit true. Ad spending tends to get a bit cheaper during leaner times, and the sellers’ digital real estate market becomes more of a buyer’s market. But it’s not that smart brands care about it less. It’s that they can shift the money they’re saving on digital advertising somewhere else.

You may also see articles about 2020 and how digital advertising was hit really hard during the pandemic. Nope. Despite an initial falloff (because people weren’t much interested in talking about buying stuff in early 2020), digital ad spending actually grew 12.2% in 2020.

The last time ad spend took a huge hit was 2008 and 2009. We saw a huge decrease in ad spend. But then it bounced right back in 2010. (You might remember 2008 because we were all putting money in our mattresses and thinking that the zombie apocalypse was coming.)

In any event, the key thing to take away in all of this is that, yes, marketing budgets will shift. But, remember, you as a marketer shouldn’t calculate the health of advertising and marketing by how much revenue the publishing platforms are making. You should calculate it on how much you’re spending to reach those same people.

There’s a good chance that your marketing budget will shift. The key is that just because something costs less – and we spend less – doesn’t mean the product got demonstrably worse or you’re reaching fewer people.

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Pundits say advertising and marketing spend is slowing. I say that’s an opportunity for us to make better use of our budget. We have to ask ourselves what we are spending on owned media because we’re now competing for the same consumer attention that the media companies are fighting for. They’re going to get scrappy to get that revenue back. And guess what? Now is our time to look for the bargains and build that direct-to-audience relationship we’ve been waiting for.

That new original content brand you’ve been thinking about putting a little money into? Well, it just got a little bit of a boost if you want to shift some of the advertising savings into it.

When the headline says that there’s a broader advertising market decline, just remember – that’s our time as the drivers of that market to exercise some well-deserved freedom of choice.

And that’s it, that’s five minutes of news you need to lead in content marketing. I’m Robert Rose. Remember, it’s your story. Tell it well. I’ll see you next week.