That’s what Lucinda Southern in AdWeek believes is the key to media company stability as they look ahead to ad predictions for 2021.
“While a number of digital publishers are enjoying a plentiful end to the year, the shortened sales cycle, market instability and nervous clients pushing for cancellation clauses mean there is much less in the pipeline for early next year,” Southern writes.
AdWeek interviewed five chief revenue offices (who, interestingly, all spoke on the condition of anonymity) about the current and near-term outlook for advertising. While one said their revenue was up 22% YOY for the last half of 2020, they did caution about being “too bullish.”
Two others said recent gains helped cancel out the dismal spring ad performance, but they are concerned this might not be sustainable, especially as the pandemic drags on and the economy grinds along with it.
“There is a delay on Q1. Everyone is holding back, wondering if people are going to make real decisions in Q1,” said a fourth digital publishing CRO. “We’ve closed quite a bit, but not what I would have expected from this year.”
On a positive note, Q4 is typically the best quarter for advertising, and consumers seem eager to be enticed to shop through advertising. In an interesting twist, however, campaign timeframes have shrunk rather significantly this year, an acceleration of the “short-termism” that gripped the industry well before the pandemic.
As a result, many marketers are adding strict cancellation clauses into 2021 ad contracts, which could leave publishers vulnerable to large, unpredictable losses.
“The CMO from one of our bigger clients told me her team is prioritizing that every line item on the media plan has some form of cancellation option next year,” said a fifth CRO at a digital publisher. “While she knows that’s not 100% feasibly possible, they are pushing partners to show the kind of flexibility they are looking for.”
All of this means that publishers need to be flexible … without leaving themselves too vulnerable … putting more pressure on forecasting. At the same time, it allows publishers to lean more heavily on the work they’ve done to truly understand their audience.
“Publishers are playing to their strengths, demonstrating that they know what their audience cares about right now, investing in surveys and research like The New York Times’ Pivotal and The Atlantic’s Brand Partners,” she explains.
“Premium digital businesses appear optimistic about the future, as long as they have scale, brand equity, ad innovation and client relationships to drive businesses forward,” she continues.
For publishers, it’s another affirmation that knowing your audience, becoming essential to them, and relying less heavily on digital ad revenue is the right approach for 2021 and beyond.
So stay flexible, stay positive, and stay on your toes. We’re almost there.
VP of Sales & Marketing, Freeport Press