Traditional and Social Media Expected to See Greatest Tariff-Related Ad Spend Cuts

Advertising and consumer spending drive much of the US economy. But in the current century to date, two significant rounds of tariffs in 2002-2003 and 2018-2020 resulted in higher consumer prices and reduced ad spend.

A new report from the Interactive Advertising Bureau (IAB) finds that 94% of advertisers expect new tariffs to lead to reduced ad spending in 2025, and projects that spend in traditional and social media will see the largest cuts.

Ad spends on CTV, audio, paid search, podcasts and online video are projected to be least affected.

57% of ad execs surveyed said they are "extremely concerned" (57%) or "somewhat concerned" (37%) about tariffs having an adverse impact on ad spend in 2025.

Expected magnitude of ad spend reduction which is expected to peak in mid-2025:

• 6% - 10% (cited by 60% of respondents)
• 11% - 20% (22%)

Adjustments advertisers said they plan to employ in 2025 to address financial constraints imposed by new tariffs include:

• Reducing overall ad spend (45%)
• Increased focus on performance-based campaigns (35%)
• Shift to more measurable digital channels (29%)
• Adjust campaign messaging (28%)
• Negotiate for more flexibility (21%)

Separately, AdAge reports that US ad employment fell by 900 jobs in April - the fifth consecutive month of ad job losses. But there's increasing demand in digital marketing roles.

Too-frequent ad repetition can erode brand interest and purchase intent

Results of new research published by media intelligence providers Magna suggest that frequent ad repetition can make brands memorable to consumers, but for the wrong reasons.

Because of the way CTV programming works, repeating ads can be a particular problem with streamed TV, which in 2022 for the first time had a market share (35%) higher than that of cable (34%) and broadcast (22%) TV.

Accordingly, Magna researchers set out to find the answer to the question: "What impact ... do repeating ads have on brands, platforms and viewers?"

In their experiment, a total of 1,236 weekly streaming viewers were recruited from a "representative" online panel. These subjects watched a TV show of their choice on their home connected TV with 1, 4 or 6 exposures of an ad. All subjects saw the same number of ads, but with varying frequencies. Participants were then surveyed as to viewing experience and brand performance indicators.

NOTE THAT from this point on, for some reason - surveys not returned or incomplete, or whatever - numbers are based on sample sizes ranging from 104 to 623 - not the entire 1,236 people mentioned above.

Results:

• 87% of survey respondents said that, in general for streaming TV, they see too many of the same ad.
• 83% said they believe that ads are intentionally repeated.
• 68% said they believe that ad repetition is intentional on the part of advertisers.

Unaided recall:

• With 1 ad exposure, 64% of subjects recalled the brand being advertised.
• With 4 ad exposures, 85% recalled the brand
• With 6 ad exposures, 92% recalled the brand.

Ads perceived as "annoying" (indexed, with overall average response = 100):

• 1 exposure: 48
• 4 exposures: 104
• 6 exposures 148

Ads perceived as "disruptive to overall experience" (average=100)

• 1 exposure: 58
• 4 exposures: 104
• 6 exposures: 133

Ads characterized as "something I wouldn't mind seeing again" (average=100)

• 1 exposure: 115
• 2 exposures: 100
• 3 exposures: 85

Perceptions of the advertised brands also varied with ad frequency:

• "Is a brand that knows how to connect with me"
  • 1 exposure: 25%
  • 4 exposures: 16%
  • 6 exposures: 17%
• "Is a brand that excites me"
  • 1 exposure: 21%
  • 4 exposures: 15%
  • 6 exposures: 16%

Ad repetition also impacted subjects' reported purchase intent:

• 1 exposure: 57% "very or somewhat likely"
• 4 exposures: 53%
• 6 exposures: 49%

Subjects' comments on their "viewing experience" included:

"It mostly felt disruptive due to the number of times it played."

"The ad itself was fine, having to watch it 4 times was the annoyance."

"Every single commercial break featured the same ad..."

"Too repetitive..."

Conclusions drawn by the researchers from the findings above are:

• Most blame brands when they see repeating ads on streaming TV.
• 36% are less open to seeing the ad again.
• Brands are paying for 16% decline in intent to purchase.
• Advertisers should avoid repeating ads.

Also, re streaming services:

• 44% of CTV viewers believe streaming services intent to repeat ads.
• 51% of viewers will form opinions or take actions to avoid repeating ads:
  • 43% try to find another streaming service with same programming
  • 35% have a less favorable opinion of the streaming service
  • 27% recommend against the streaming service
  • 20% stop watching the streaming service
  • 19% unsubscribe from the streaming service

Ad formats subjects said they would prefer:

• Long ad break before the show, rest of show uninterrupted: 60%
• Shorter ad breaks during show: 34%

Re ad platforms:

• Nearly half said they blame platforms for repeating ads on CTV.
• 51% said they would take action against the platform if they had this kind of viewing experience.
• Most said they want fewer interruptions while viewing.

Comments:

1. Intuitively, findings seem reasonable, but quantifications come from small numbers drawn from an undefined and self-selected "representative" population - so take with a grain of salt.
2. Even if of lesser degree, these findings about people disliking repeating ads have application beyond CTV for brands, media and ad platforms. Running annoying ads will hurt your rep and could negatively impact sales.

Longer mobile video ads convert better

Redwood, CA-based mobile advertising specialists Liftoff have released a report showing that based on data from their customers (mainly mobile app creators) video ads 31-60 seconds long are converting at "up to" 50% higher rates than do shorter video ads.

They theorize that this is happening because longer ads are better able to showcase the features of apps, and better permit ads to tell stories.

Their recommendations for video advertisers are:

• To save time and money, rather than starting from scratch, stitch together some existing shorter videos.
• Develop a well-rounded story with a compelling hook and a satisfying conclusion.
• Use longer ads to show off the features of your app and reach a broader audience.

Comments: Some mobile video ad facts

• Among ad formats, video ads most engage the user.
• 75% of video ads are consumed on mobile devices.
• 98% of persons aged 18-34 watch videos on smartphones daily.
• More than 60% of digital video campaigns were run on mobile devices in 2022.
• Smartphone owners use their devices an average of 170 minutes daily.
• Mobile video ads lend themselves to both behavioral and contextual targeting.
• Mobile video campaigns can be developed and deployed at lower cost than traditional ad forms.

Google this week announced the introduction of Ads Creative Studio which is intended to facilitate teamwork by designers, agencies, brands and media planners and be "a unified home for Google's creative advertising tools, to help you build compelling experiences for video, display and audio ads."

Initially, Ads Creative Studio will be available in beta only to Google's Display & Video 360 (formerly DoubleClick Bid Manager) customers - that is, programmatic ad buyers.

Features that will be available in one place at Ads Creative Studio include:

• Director Mix - previously available only to selected advertisers - which enables the customization of creative for different audiences by building multiple versions of a YouTube video ad with swappable elements.
• Dynamic display and HTML5 tools for generating customized, interactive creative for Display & Video 360 and Campaign Manager 360
• Audio Mixer and new dynamic audio tools for building custom audio ads for Display & Video 360 at scale

A new Project Library supports integrated multimedia asset construction and management so that, e.g., one team can maintain creative elements while another uses them in campaigns. Teams can use a common workflow across video, display and audio ads and easily create custom messages.

Ads Creative Studio is intended to improve collaboration across and within teams by enabling multiple users to work together on a project, and reuse creative assets across projects.

All output from Ads Creative Studio can be exported to other Google advertising products including Google Ads, Display & Video 360 and Campaign Manager 360.

Ads Creative Studio is scheduled to be available in beta to Google's Display & Video 360 customers by 1 August 2021 and to some YouTube Ads customers in September.

New features will be announced as they're added.

Follow this link to find out more about how you can get fast marketing results from Google Ads paid search.

New research by Ipsos for Google finds that targeting YouTube ads by user intent (e.g., in-market audience segments) produced response lift on 4 metrics vs. targeting on demographics:

• Ad recall +32%
• Awareness +167%
• Consideration +267%
• Purchase intent +100%

and also reduced ad skip rate by 10%, from 61% to 51%, and increased mean playback duration by 20%.

Procedure:

Researchers created 16 video ads related to 4 life events (getting married, buying a home, moving, home renovation) and 2 levels of targeting (demographics or intent) and delivered the various ad/event combinations 1800 times to users.

Interestingly, in a second experiment, researchers compared the effect of ad content quality on lift on those same ad metrics, and found no additive lift from broadcast-quality video vs. "endemic YouTube" quality video