Friday, May 7, 2010

Why one plus one plus one doesn't equal three when talking about media fragmentation

Some of my publisher friends have begun to wonder why advertising remains so weak, while at the same time some publications appear to be recovering with gusto. The inevitable question is always "when will the recovery hit us, too?"

Leaving aside the issue of economic recovery (since one look at the events of yesterday regarding stocks, Greece or the UK might make you wonder if a recovery is on the horizon), the chances that advertising will rebound across the board is very small. Each downturn in the economy leads to reductions in advertising, of course. But it also leads to advertisers attempting to find new ways to market outside the world of B2B and consumer magazines, newspapers, etc.

Combined with the increasing fragmentation of media, this is leading to many media properties being edged out of budgets permanently. Further, those properties that are getting new schedules are finding that they have to offer more and more options themselves, or else have a piece of their schedule reallocated.

Take a simple marketing tool like e-mail and e-mail newsletters. Any small advertiser that finds their budget cut can very affordably begin their own e-mail marketing campaigns through widely available companies that have sprung up over the last decade. A return to healthier budgets simply won't stop this approach, though often publishers can win back some of the business by promising to take on those responsibilities themselves as a added-value item on the schedule.

Additionally, the growth in alternative forms of media -- now mobile, then Internet -- means that adding a new form of marketing to the budget doesn't necessarily mean a growth in actual dollars spent, or the addition of a new media outlet. In other words, one plus one equals two -- but adding another one simply might mean one of the old media outlets will be left behind.