MEDIA FORUM: How are media owners preparing for a recession? Is a media slowdown inevitable? Are the media owners powerless to halt economic meltdown or can they turn the tide? Alasdair Reid reports

Recession, what recession? Didn't Ron Zeghibe look smug last week

in that picture in the Financial Times? But then Maiden Outdoor's chief

executive had every right to be smug, having just announced a pretty

healthy set of financial results for the year 2000. And that wasn't all

- he was also predicting that this year will be a good one.

Zeghibe clearly likes to zig while others are zagging - wasn't it just

12 months ago that he was issuing a profit warning as everyone else was

gearing up for the biggest boom in a decade? And now Maiden is riding

high at a time when most other companies across all sectors are facing

the future with some trepidation. Take Capital Radio, which was moved to

issue its own profit warning last week.

City analysts have begun mooting a media industry 'bloodbath' lasting

not just one or two quarters but continuing across the whole year.

Worrying talk. And it's not too surprising to find many analysts arguing

that of all the media sectors, TV could be in for the roughest ride.

It's the biggest medium, after all, and it had an excellent year last


So it probably came as no surprise to a select number of agencies across

town when they realised that the bosses of ITV's two sales points were

both waiting in reception.

Yes, the ITV roadshow has hit town - and Mick Desmond, the chief

executive of Granada Enterprises, and Martin Bowley, the chief executive

of Carlton Sales, are doing a double act. They aren't visiting media

agencies - that could be constituted as a joint sale and therefore

illegal - but have targeted the top 30 creative agencies and are aiming

to reacquaint senior creatives and account men with the power of

television as a medium.

Which, on the face of it, would seem to suggest that ITV is taking the

threat of recession very seriously indeed. After all this is surely the

first time that anyone's felt the need to go out and actively sell ITV

since ... well, since the 50s probably.

Will it work? Can media owners come up with strategies to combat

recessionary trends? Or is this sort of thing merely cosmetic? Are they

actually powerless in the face of macroeconomic forces?

Bowley says that this is actually unfair - this marketing initiative was

planned months ago. He states: 'What we're doing is reconnecting with

the top creative agencies, which after all have the highest possible

contact with the client. If the brand leader isn't going to do this sort

of thing, then no-one else is going to do it for us. The response has

been extremely positive. We're reconnecting people with TV, the most

powerful medium in the world, with the agencies which create the most

powerful advertising in the world. They have been staggered about how

strong ITV is and we are able to tell them how they can be more fully

involved with the programming.'

But Bowley does admit that the initiative is timely. They're effectively

pitching TV against other media - and any business they can stimulate

will be more than welcome. He adds: 'What I would say is that if there

is to be a recession, not everybody will be in recession and for many it

will be an excellent time for people to grab extra market share and to

drive sales. I think Abbott Mead Vickers should be an inspiration to us

all. In the last recession when everybody was sacking people it decided

not to lay off one single person. Look where it is now. As in all

recessions the strong will survive and if there is any message at all

here it is that ITV is in a strong position.'

Fighting talk. Is everyone in the same combative mode? Well, sort


Neil Hurman, the ad director of national titles at Trinity Mirror, says

that the best way to combat the threat of a recession is to stop talking

about it. He also argues that there's not enough clarity of thinking

when people begin discussing this issue. 'You have to be clear about

what sector you are talking about and what comparisons you are making.

The national newspaper market, for instance, is not one single coherent

market. The broadsheets benefited massively last year not just from

dotcom advertising but also business-to-business and financial

advertising in general. There was complete lunacy around last year and

the broadsheets were never going to generate growth on that. But they

might generate growth on 1999 which is probably the more realistic


And Hurman is actually very upbeat. 'The truth is that, from where we

sit, the indicators are still strong. People still have jobs, they still

have money in their pockets and they are still prepared to spend that

money. It might be true that some advertisers are tempted to sit on

their hands for the next few weeks. But we haven't spoken to a single

agency press chief who says that clients are actually planning to cut

their budgets.'

Others are perhaps more cautious. For instance, Graham Duff, the chief

executive of Zenith Media, is slightly sceptical about the ITV


He doesn't think they're targeting the right people for a start. And at

best, he argues, it will stimulate peripheral revenues. 'I think it's

generally admirable what they are trying to do. It is a case of proving

that no stone has been left unturned. But fundamentally, they are

looking at a shortfall running into tens of millions and this initiative

won't generate business to cover that shortfall. The real issues here

are macroeconomic ones.'

And you could argue that prospects for the UK economy look more than a

little shaky. A US slowdown will surely affect the UK sooner or later

and we will also have the added uncertainty of an election - probably in

June -and a foot and mouth crisis in the countryside. If company profits

start to evaporate, the first thing to be cut will be marketing budgets.

Surely no amount of brave talk can counter that - and some media owners

must know that in their heart of hearts.

After all, Capital's announcement was hardly upbeat, now was it? But

Nikki Mendonca, Capital's strategic marketing director, says there's

plenty you can do. She states: 'We have a hitlist of people who we think

could be using more radio - advertisers who are very TV biased, for

instance. Our aim is to show them what they would gain by redeploying

some of their budget on to radio - for instance, we're able to

illustrate increased cover and the ability to maintain your presence in

the market for longer. It's true that at a time like this it's hard to

get yourself to the top of their agenda and the only way you're going to

get anywhere is if you come to them with new news. But we certainly

believe we have a convincing story to tell them.'


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