Dot-com prediction coming true

If you're a regular reader of this space, you may recall that in the first issue of the New Year, I proffered a list of predictions for the ensuing 12 months. Prediction number four boldly stated that "the bottom will fall...

If you’re a regular reader of this space, you may recall that in the first issue of the New Year, I proffered a list of predictions for the ensuing 12 months. Prediction number four boldly stated that "the bottom will fall out of over-heated technology stocks in the U.S., leaving only those companies that really do have viable products and services to survive." Barely into the second quarter, the first half of that prediction became very, very real with tech stocks on virtually every exchange around the world plummeting in value from their previously stratospheric highs.

What remains to be seen, though, is whether the companies that have been most affected by the downturn in the markets will be driven out of business as a result. Some will. It’s really a question of when.

No question, the pressure is now on to start producing bottom-line results. As our page one story in this issue attests, the financial travails of dot-com retailers in the U.S. has had a major impact on a lot of agencies that had blithely sidled up to the cyber-trough and agreed to produce massive ad campaigns for clients with little or no brand equity. The commitment of resources needed to produce these campaigns was typically great – not a problem if the client has cash flow and pays their bills on time. Unfortunately for a lot of agencies, however, the vast majority of dot-com firms still have minimal revenue streams, with their operating capital being provided almost exclusively by investors. With that support being quickly withdrawn, however, a lot of supplier invoices are suddenly hitting 60- and 90-day status. Are agencies worried? Oh yeah.

But what about here in Canada, where dot-com fever has been decidedly more tepid than in the States? Clearly, the situation isn’t as dire, but the stakes have been raised. If it wasn’t the case before, you know that any dot-com client looking to hire an agency is now going to have to spend as much time pitching themselves as will the agencies being considered for the assignment.

One would think that there will also be less inclination on the part of both client and agency to accept the wisdom that all that’s required to turn an interesting dot-com idea into a viable business is a big, splashy ad campaign. The thinking for a lot of dot-com people has tended to be along the lines of, ‘Advertise it, and they will come.’

As we now know, that simply won’t do. A little more commitment to solid business planning and delivering on promises is what’s needed. If clients and agencies can work together toward that goal, things could work out very profitably for everyone.

David Bosworth

dbosworth@brunico.com

From Karen Howe’s dining table: Creativity, COVID and Cannes

ICYMI, The Township's founder gathers the best of the best campaigns and trends so far.

Cannes Base Camp

By Karen Howe

I’m attending Cannes from the glory of my dining room table. There’s not a palm tree in sight, yet inspiration and intel are present in abundance.

Cannes Lions is a global cultural pulse check. The social course correction in the wake of the murder of George Floyd and BLM has delivered far greater diversity in the judging panels as well as the work. And we are all better for it.

I’m proud to say that creativity defeated COVID, which speaks to its power. Great work and big ideas flourished, despite unimaginable odds.

The work from the past two years spans a vast emotional range. From the profundity of Dove’s “Courage is Beautiful” to the hyper exuberance of Burberry’s “Festive,” they are opposite ends of the spectrum, but each answered a need in us.

Take note, the ascendency of gaming cannot be understated. Smart brands have embraced the channel. It makes sense, because gamers participate to meet others around the world, not just to play. And they represent a huge and powerful community. That’s why QSR Wendy’s gamified their iconic gal in RPG’s Feast of Legends.

Burger King sponsored the unknown Stevenage Football Club, transforming the team into online heroes and vaulting BK into the fray at the same time. Once again, the brand embedded itself in culture.

The birth of gaming tourism arrived when Xbox snuggled up to travel guides and created a brilliant baby: a travel guide for gaming worlds. It, too, embedded itself in culture.

From the standpoint of social good, Reporter Without Borders showed how it worked with Mindcraft for its “Uncensored Library” to bypass press censorship, with Minecraft providing a loophole to a space where young people could be educated. It provided youth with a powerful tool to fight oppression: truth.

COVID changed us in unexpected ways. We learned how to pay attention again and there was a notable lack of 30-second commercials. Instead, longer format content thrived. Apple’s WFH was seven minutes long. Entertainment reigned king, so we find ourselves returning to our advertising roots.

Seeing competitive brands form partnerships was one of this year’s other great surprises. The brilliantly simple “Beer Cap Project” by Aguila to reduce binge-drinking saw the brand reach out to competitive beers to join in. Aguila put incentivizing (keyword: free) reminders to drink water, eat food and get home safely on its bottle caps from all sorts of fast food chains, ride-share co’s and H2O brands.

On a personal level, I’m so proud of Canada again this year. Given that it was two years of work from all over the world being judged, even making the Cannes shortlist was an accomplishment. Canada is herding in the Lions in tremendous numbers – and it’s not even over. Fingers are crossed.

KAREN-HOWE-PIC-higher-rez-300x263Karen Howe is a Canadian Cannes Advisory Board Member and founder of The Township Group