Most Marketers Cutting Budgets, Renegotiating With Agencies

ANA Survey: 77% Plan to Cut Media Spending

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NEW YORK ( -- In case you weren't sure, it really is worse than you thought. In a new survey conducted by the Association of National Advertisers and released today, 77% of marketers indicated that they plan to reduce their advertising campaigns' media budgets. That staggeringly high number is an ominous sign of things to come.

"There's no good news in this report all," said ANA President-CEO Bob Liodice. "This is not good for advertisers, this is not good for agencies, and it's certainly not good for media."

This is especially true considering the marketing industry typically lags six months behind the economy overall, so even if things turn around in July, marketers won't feel the impact until 2010.

But the survey results are not surprising, Mr. Liodice said. "The key message I've gotten from my members over the past few months is that there's terrible uncertainty out there."

Among the other bleak findings: 72% of marketers plan to reduce advertising-campaign production budgets; 68% plan to "challenge" agencies to reduce internal expenses and/or identify cost reductions; and 48% are looking at reducing agency compensation today.

Earlier survey
The survey was a follow-up to one conducted by the ANA last August. In that earlier survey, marketers were less pessimistic. But, as Mr. Liodice pointed out, it captured their thoughts before the collapse of the stock market.

"Things were starting to turn down [in August], but we had not reached the tip of the iceberg," he said. In one of the questions on that August survey, the ANA asked marketers if they thought their budgets would be cut in the next six months, and 53% said yes. But this recent survey reported a much darker reality: 71% of marketers experienced budget cuts.

Mr. Liodice added that the recent survey findings mirror the dim outlook of the national economy as a whole. "There isn't much golden sunlight shining on anyone's head right now," he said.

The 141 marketers surveyed were members of the ANA and represented a range of industries, including pharmaceutical, financial services, consumer package goods, retail, computers and technology.

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