WFA report: 80% of multinationals deferring campaigns
Four out of five marketers from major global brands say they are deferring planned campaigns as a result of the Coronavirus crisis, according to new research conducted last week by the World Federation of Advertisers (WFA).
A third (34%) have initiated short one- to two-month delays, while 28% are holding off for a full quarter and 13% will wait for six months before bringing campaigns back to market.
Despite the bleak news, 79% of multinational businesses said they were creating new messages in response to the pandemic.
Fifty percent of these new messages have already started running or are about to go live and a further 29% plan to start creating new messages soon.
The net result of these changes, however, is a drop in annual marketing budgets with 57% of respondents saying they are cutting spend and 32% showing no change.
The numbers are based on a survey of 32 WFA member companies with a collective annual marketing spend of nearly $60bn across 10 industry sectors. Sixty-nine percent of respondents had global responsibilities with 31% in regional roles.
In a separate poll of 58 media leaders conducted during a WFA member webinar on 31st March, respondents anticipated an average reduction in media budgets of 23%. Twenty-one percent of the sample predicted cuts of 40% or more.
The survey also finds that marketers have been "mindful" of the impact of the cut in spend on their industry partners.
Last week, Warc warned the global economy is set to fall into recession with the ad market likely to follow in the first half of this year.
In February and March, the Purchasing Managers' Index, a monthly survey of trading conditions in private sector companies, recorded the worst results for the services sector in recent history across the US, UK, Europe and China, with all regions in decline.
Warc said the COVID-19 crunch is now filtering through to advertising, with commercial broadcasters across Europe and the US all reporting a decline in ad bookings.
In the UK, ITV, the largest commercial broadcaster, and JCDecaux, the largest out-of-home media owner, said they both expect ad growth to be down 10%.
Meanwhile, Baidu in China advises first quarter revenue will be down by as much as 18% while other online pure players, such as Alphabet, Twitter and Facebook are also exposed - largely because digital channels are often the easiest to switch off in a time of crisis.