Mismanagement and Fear

Recent news shows ITV making sweeping cuts across their business, and citing reduced TV advertising revenue as the rationale.  They blame a shift in spend to online as the root cause.  All makes sense so far… except one of the budget cuts they are making is to offload ‘Friends Reunited’, the social networking site.  They are divesting of their online assets in order to deal with a growth in online…. what?

There’s more to this than meets the eye.  Online has indeed eaten into traditional media spend, but most savy offline media bought into online at a time when it became clear this would happen.  ITV bought one of the first (and financially most stable) social networks long before the social networking phenomenon became the big business it now is.  They were ‘best placed’ to be enormously successful, but somewhere down the line this prize asset, the grandfather of social networks, was allowed to dwindle and become insignificant in the fastest growing market in online.  Mismanagement and fear.

And it continues elsewhere in the big ‘brands’.  Speaking to marketing types dedicated to digital, they are all seeing their budgets slashed this year.  So, not only is spend in traditional media being cut, but, rather than divert budget to an accountable, measurable media like online, they make the cuts across the board.  Shortsighted behaviour.  Mismanagement and fear.

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