The victory for Donald Trump in the US presidential elections will spell uncertainty for advertising markets in Asia Pacific, the boss of the region’s most powerful media buyer said this afternoon.
As the billionaire Presidential contestant from Republican party edged closer to electoral victory, Mark Patterson, CEO of GroupM Asia Pacific and chairman of the WPP media buyer in China, said that the result moves the global economy, and in turn advertising markets, into unchartered territory, much like the British vote to leave the European Union.
“This [Trump victory] will undoubtedly create a degree of uncertainty in some quarters which impacts the financial markets, confidence, investment decisions and planning,” he said this afternoon.
“In these circumstances, marketing budgets tend to come under greater scrutiny as the ripple effect economically is considered and anticipated in the region.
“So in the immediate term no shock wave, but in the longer term we will just have to see how it plays out.
“In some senses, much like Brexit, we are in uncharted territory,” said Patterson, who was speaking at the CASBAA Convention in Macau yesterday.
Analyst group Pivotal commented that Trump’s win showed that – like Brexit – a failing of data.
The group has published the following considerations for a Trump win that are mostly relevant to the US, but also have global implications:
- “If trade barriers are generally raised within the US, we would expect negative repercussions on the US economy. Given the tight correlations between economic health (especially personal consumption expenditures) and advertising growth, we would expect a downturn if new trade barriers are put in place.
- “Companies we cover which are more exposed to international markets are relatively better positioned, although economic weakness in the US would undoubtedly hit other markets as well.”
- “Agency holding companies Interpublic, Omnicom, Publicis and WPP have the greatest exposure to international markets – WPP especially – among “traditional” media companies we cover,” the group said.
- “Alphabet (Google) and Facebook generate a majority of their revenues abroad, so are relatively better off versus most others.”
- “As one Jeb Bush strategist tweeted, “data died tonight”. Conventional polling failed – again – to accurately anticipate the outcome of a major event, following the surprise of Brexit in June.”
- “However, far from causing users of data (political data in particular) we think that it will cause greater investment in data and measurement services. To the extent that new approaches evolve in data science for other categories of marketers, the sector (which includes Nielsen) could benefit.”
- “Privacy issues may become non-issues as it seemed likely that Democratic control of the FTC and FCC would have led to more aggressive regulation. Owners of data will benefit from this election. As we saw with the FCC’s recent order that would negatively impact ISPs (if implemented) to the benefit of Facebook and Google, data that Verizon and Comcast possess may be more readily usable in their ad sales businesses.
- “Idiosyncratic company risks will emerge, especially among owners of news properties. We have already seen Trump engage in a dispute with the CEO of Amazon over his ownership of the Washington Post, and also stated that AT&T’s acquisition of Time Warner should be blocked. While companies may still prevail with regulators or in the courts, a President Trump could very well threaten other media companies who own news properties at different points in time.”
- “Fox will benefit from a lack of new competition – probably. A “Trump TV” had been widely reported as an initiative that Trump would have pursued had he lost. While it’s possible one could still emerge under the leadership of his advisors, presumably the impact on Fox would be less significant if Trump is engaged in the Presidency.
- “Immigration restrictions will presumably impact companies that need to hire talent, but may serve to accelerate investment in international operations. While we would imagine that there will be tighter rules on immigration under the new administration, we also note that companies who tend to hire talent from abroad (including Facebook, Google and the agency holding companies) will prioritise investments in talent hubs abroad rather than investment in the United States.”
- “Twitter may not benefit financially, but demonstrated its impact nonetheless, which may highlight to brands the power of the platform. More than any other medium in this election, we think that Twitter demonstrated its capacity to serve as a medium whose impact exceeds the scale of its usage. This may serve as a powerful reminder to brands that effective use of Twitter can drive outcomes.”
Tobias Wilson, the chairman of the Interactive Advertising Bureau of Southeast Asia, and CEO, APD Singapore, commented wryly that a win for Trump showed that a contentious product can gain popularity with good marketing.
He said: “I think the Trump win will make our industry great again… It proves that even with a sh*tty product, you can win with a good marketing campaign.”
“I’m also hoping that it encourages some talent (both home-grown and foreign) to seek safer shores, which can only be a good thing for our industry.”
Source : Mumbrella
