With GM bankrupt, the housing market in the toilet and a worldwide economy on the skids, one has to wonder just how long the “put a happy face on it” magicians in pinstripes can stay in character.
According to Media Daily News, Publicis CEO Maurice Levy estimated that the advertising marketplace declined between 13% and 15% for the first half of the year. “These increasingly extreme corrections have come in response to an unexpectedly steep curve,” Levy stated, before adding that Publicis isn’t losing money as fast as the rest of the clowns.
U.S.-based Omnicom Group, this morning reported a 17.4% decline in second quarter, and a 15.8% decline in its worldwide revenues. During a conference call with the press, Chief Executive Jon Wren said that the results were in line with the company’s own expectations and “correlate closely with industry sectors under stress” while also reflecting the “elimination of discretionary projects by some clients.”
“We think investors (in these companies) should brace for a steep decline in organic revenue,” Deutsche Bank analyst Matt Chesler told The Wall Street Journal. The Journal also indicates that marketers have slashed the fees they pay agencies by 5% to 30%. Talk about salt in the wound.
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