'Permanent' change caused by crisis

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Anyone else feeling a little like a just-awakened Rip Van Winkle? ΒΆ BusinessWeek is up for sale? GM filed for bankruptcy? Congress may actually pass comprehensive health care reform? And, yes, I understand the140-character limit. But did you say there are almost 12 million people and businesses on Twitter? It's clear that budgets, organizations and strategies have shifted. What's less obvious but more sobering, I think, is the sentiment—heard frequently at executive-level gatherings these days—that many of these changes are permanent. I believe the recession only turbo-charged trends, notably the adoption of digital and social media, that were already well under way. Once the U.S. economy rebounds (happily, there's some recent evidence this has begun), will you turn back to traditional ways of reaching, engaging and interacting with customers and prospects? Not likely. Three stories in the current issue reflect the monumental changes wrought by the recession and illustrate how marketers have responded. To start, our annual report on the Top 100 B-to-B Advertisers (page 20) shows in stark numbers the impact of the downturn: Among the top 100, spending on media (business magazines, consumer magazines, newspapers, TV, radio, online and outdoor) fell 10.2% last year; among all b-to-b companies, the falloff was even bigger, at 12.5%. Among the top 10 advertisers, just three (Microsoft, GE and Deutsche Telekom) increased spending, according to our report, which analyzes ad spending data from TNS Media Intelligence. But slashed budgets are only part of the story. As Senior Reporter Kate Maddox reports in her story “Tough economy forces marketers to reorganize” (page 1), many businesses are using the recession as a opportunity to restructure, consolidating both their in-house marketing departments and agency partners. Maddox quotes Eduardo Conrado, senior VP-global business and technology marketing at Motorola Inc.: “In the past, we were organized by business units. We had five different product marketing organizations, which are now consolidated under a single product marketing organization that reports to my group.” In the same story, AMD CMO Nigel Dessau, discussing consolidations of agencies and campaigns at the chip- maker, says, “It has really been about driving simplicity and focus.” And what could be more simple than direct communication with customers and prospects? As Media Editor Sean Callahan reports, that fundamental shift has hit media companies squarely and harshly. “These new forms of direct communication,” Callahan writes, “help to explain the plunge in trade publication advertising, which was down 30% in the first half of 2009, according to American Business Media.” Are there any bright spots for traditional media? Maybe one. While most marketers have hunkered down during the economic crisis, focusing on short-term lead-gen via relatively low-cost, direct-to-consumer digital channels (often bypassing traditional media partners), I remain convinced we'll see a significant upswing in longer-range branding campaigns that rely on traditional media outlets. Why? Because it's inevitable the recession's strongest survivors will start acquiring the weak, and mergers spark brand alignment followed by branding campaigns. That's one phenomenon the recession won't change. Ellis Booker is editor of BtoB and BtoB's Media Business. He can be reached at
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