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There is no point in advertising if no one can buy your product right now. Retailers, dine-in restaurants, movies, hotels, travel, pro sports, big clothing bran

There is no point in advertising if no one can buy your product right now. Retailers, dine-in restaurants, movies, hotels, travel, pro sports, big clothing brands, concerts, events, tourism. The list goes on and it is massive. All these industries are huge spenders on advertising. Then there are all the products and services that _could_ be bought, but consumers and companies have pulled back on because of uncertainty. Why waste money on ads for TVs, new phones, SaaS software, hiring, etc? We left our ads running even though conversion rates dropped by 75% because Google offered something like $!00M in ad credits for small businesses. We applied for the program but haven't heard anything. It might be time for us (marketplace for quality contract work) to stop spending on ads too.

londons_explore 7y ago
Since ads are a supply-demand market, supply must equal demand. There is nobody who can store ad slots in a warehouse and sell them later. Since publishers are unlikely in the short term to take down their websites just because revenue falls, that has led to prices dropping to near zero on the open market. The only real revenues now are from advertisers who have fixed price per impression or per click contracts, or who aren't smart enough to see they could drop their bids 90% and still win the same spots.
- ramblerman 7y ago
  Perhaps I'm just not clever enough, but this reads like a homework assignment saying the same thing OP did much more eloquently: "There is no point in advertising if no one can buy your product right now"
  - londons_explore 7y ago
    The element I was trying to add but not wording well is that even if some people are still paying for ads, and still have things to sell, they price they pay will be dropping dramatically. Theres a reason Netflix has been advertising so heavily lately - with cheap ad spots, they might as well collect as many customers as possible now.
    - ramblerman 7y ago
      Fair enough, my comment was a bit tongue in cheek. Thanks for clarifying the point.
    - CydeWeys 7y ago
      That, and they're one of the few products that people can still consume easily right now. So I suspect it'd still be worth it for them to increase advertising even if the ads were priced normally, but now that they're super cheap, it's an absolute no-brainer.
- onlyrealcuzzo 7y ago
  That's not really how ads are priced, though. Google and FB will be reluctant to see the price of ads go down. They also control the supply of how many ads they put on the page. They make sure the supply of ads for keywords is always less than the demand to fit an optimal price/revenue curve. It's more like OPEC, and less like a free market.
  - Spivak 7y ago
    Sure but they aren’t immune to the fact that absolute revenue for both them and the sites hosting the ads falls in proportion which is the point even if they keep price/ad fixed.
lostgame 7y ago
And nobody should be spending money beyond necessities right now - and stocking up on backup necessities. It’s not the time to be buying a new car, it’s not the time to be trying new makeup products, and then we have other issues - it’s not the time for new films in the cinema, it’s not the time for sports, the lists go on. It’s not time to buy new products, and certain subsets of products are no longer allowed to exist. I hope advertising suffers a lot, to be honest; it’s an industry of corruption, manipulation, and lately, privacy violation.
- gdulli 7y ago
  We can't be at the extreme of consuming normally, because that requires all stores to be staffed normally. We also can't go all the way to the other extreme. If we have unprecedented employment now, with partial non-essential consumption, we don't want to see what it looks like when we turn down consumption to further extreme degree on top of that. We need an equilibrium, and shutting down the economy fully is as misguided as reopening it prematurely.

londons_explore 7y ago

Since ads are a supply-demand market, supply must equal demand. There is nobody who can store ad slots in a warehouse and sell them later. Since publishers are unlikely in the short term to take down their websites just because revenue falls, that has led to prices dropping to near zero on the open market. The only real revenues now are from advertisers who have fixed price per impression or per click contracts, or who aren't smart enough to see they could drop their bids 90% and still win the same spots.

ramblerman 7y ago
Perhaps I'm just not clever enough, but this reads like a homework assignment saying the same thing OP did much more eloquently: "There is no point in advertising if no one can buy your product right now"
- londons_explore 7y ago
  The element I was trying to add but not wording well is that even if some people are still paying for ads, and still have things to sell, they price they pay will be dropping dramatically. Theres a reason Netflix has been advertising so heavily lately - with cheap ad spots, they might as well collect as many customers as possible now.
  - ramblerman 7y ago
    Fair enough, my comment was a bit tongue in cheek. Thanks for clarifying the point.
  - CydeWeys 7y ago
    That, and they're one of the few products that people can still consume easily right now. So I suspect it'd still be worth it for them to increase advertising even if the ads were priced normally, but now that they're super cheap, it's an absolute no-brainer.
onlyrealcuzzo 7y ago
That's not really how ads are priced, though. Google and FB will be reluctant to see the price of ads go down. They also control the supply of how many ads they put on the page. They make sure the supply of ads for keywords is always less than the demand to fit an optimal price/revenue curve. It's more like OPEC, and less like a free market.
- Spivak 7y ago
  Sure but they aren’t immune to the fact that absolute revenue for both them and the sites hosting the ads falls in proportion which is the point even if they keep price/ad fixed.

lostgame 7y ago

And nobody should be spending money beyond necessities right now - and stocking up on backup necessities. It’s not the time to be buying a new car, it’s not the time to be trying new makeup products, and then we have other issues - it’s not the time for new films in the cinema, it’s not the time for sports, the lists go on. It’s not time to buy new products, and certain subsets of products are no longer allowed to exist. I hope advertising suffers a lot, to be honest; it’s an industry of corruption, manipulation, and lately, privacy violation.

gdulli 7y ago
We can't be at the extreme of consuming normally, because that requires all stores to be staffed normally. We also can't go all the way to the other extreme. If we have unprecedented employment now, with partial non-essential consumption, we don't want to see what it looks like when we turn down consumption to further extreme degree on top of that. We need an equilibrium, and shutting down the economy fully is as misguided as reopening it prematurely.