Microsoft acquired digital ad agency Razorfish two years ago as part of its $6 billion purchase of parent company aQuantive. The industry has been waiting for Redmond to part ways with the ad shop since then. Now it’s formally on the block: Microsoft has reportedly hired Morgan Stanley to broker a deal.
It’s now conventional wisdom to expect advertising declines of 20 percent or more as the big media companies deliver this season’s earnings reports. But the giant ad holding companies that make and place those ads aren’t getting beaten up quite as badly. In fact, they’re all delivering remarkably similar results.
Ad giant Omnicom reported that its revenue dropped 14 percent and profits declined by 21 percent in the last quarter, but investors are bidding up the stock in a down market. That’s presumably because the profit slump isn’t as bad as Wall Street expected. But maybe investors are buying some of the optimism CEO John Wren doled out–sparingly–during the company’s earnings call: He thinks stimulus spending could lead to more advertising spending by the end of the year.
More than a third of all U.S. homes now have TiVo-like digital video recorders, and the majority of DVR users fast-forward through ads when they watch TV. One way to stop that: Make ads with bizarro visuals that demand your attention.
File under “odd timing”: On the same day that Citigroup makes headlines as the beneficiary of a $300 billion bailout/prop-up, the bank begins a new marketing campaign. But don’t worry, U.S. taxpayers–the bank you’re buying a piece of isn’t blowing much dough on this one–it’s on Facebook.
Peter Kafka has been covering media and technology since 1997, when he joined the staff of Forbes magazine. Most recently, he has been the managing editor of the tech and media Web site, Silicon Alley Insider. Read more »
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