Asked how he could sleep at night after spending his days on Madison Avenue dreaming up ways to sell housewives soap flakes and cigarettes, Don Draper, anti-hero in the 1960s-based television drama Mad Men, replied: “On a bed made of money.” If only adland's mattresses were as comfy today.
The world may have avoided a financial “apocalypse”, as Sir Martin Sorrell put it yesterday. Yet the chief executive of WPP sees little reason to celebrate. Not only did the world's biggest ad agency report a 47 per cent fall in first-half profits; revenues next year are expected to be no better than this year's. That is in spite of a run of events that usually boost ad spending, such as the soccer World Cup and US mid-term elections. Even that glum forecast may be too optimistic. GroupM, WPP's media buying group, forecasts worldwide media spending will slip another 1.4 per cent in 2010.
WPP's view is in contrast to the more hopeful beliefs of US-based Omnicom and France's Publicis. They called a bottom to falling ad revenues last month after their first-half sales dropped by as much as 9 per cent. But bottoming out is one thing, recovery another.