IAB Europe’s Chief Economist Talks to ExchangeWire About The Impact of COVID-19
In the first of a series covering the effect of the ongoing outbreak of the Covid-19 strain of coronavirus upon the advertising industry, ExchangeWire spoke to a variety of technology vendors and industry associations for their insight into how the sector can successfully adapt during such unprecedented times. IAB Europe’s Chief Economist Daniel Knapp was one of the experts to share their views. Read his view below and access the full article on Exchangewire’s website here.
A period of radical change
Many adtech and martech companies and platforms exist on narrow margins, so need the volume and diversity of their client base, including SMEs, to thrive. To support the industry ecosystem, new, flexible payment terms are going to be required whilst endemic issues, such as brand safety, will need to be addressed, as the surge in readership and news attention has not translated into increased publisher revenues. With these companies’ unique position, between message and end user, there is the opportunity to be altruistic and serve society by bringing socially-important, public service announcements to the people who need them.
However, it is apparent that this crisis will impact ad spend: with entire industry segments halting and retooling production lines for basic goods to combat the crisis comes a major lag in the ability of ad spend to recover. That being said, the impact will differ across the advertising world: structural shifts in how businesses operate will upend how people work and collaborate and accelerate trends in digital transformation. Companies will be forced to be more radical, throw off legacy structures and position themselves in a much leaner manner. This will inevitably, eventually, lead to more ad budgets moving into the digital domain. Those companies who navigate the recession, and survive this period of radical change, will come out stronger on the other side.
Daniel Knapp, Chief Economist, IAB Europe