I had a brief conversation today with a close friend and colleague of mine in the online advertising industry. We arrived at some slightly crystallized views about the turbulent economic and political times.
First, Q1 of 2009 is destined to be downright bloody in the online ad economy, amidst a larger U.S. recession. Keep in mind weâ€™re still riding the wave of a relatively strong 2007, as well as 2008 spending commitments that have been baked in for almost a year. Weâ€™re also buffered partly by election-season spending.
But the real economic indicators suggest weâ€™re headed for a storm. Weâ€™re already seeing panic and consequent retrenchment and layoffs at a variety of companies, including start-ups (led by their VCs), traditional media companies and marketing-services firms. Consider plummeting auto sales, home sales and retailing — even soft indicators like the exploding number of cheap gym-membership deals. Oh yeah, then thereâ€™s the financial-sector calamity. It will be survival of the fittest, without a doubt.
Second, doom and gloom is a self-fulfilling prophecy. Businesses, governments and citizens canâ€™t fail to confront reality, but they also must not let panic take over unnecessarily, like a cancer. This recession is an opportunity for the most talented, devoted leaders to execute well. Customers are hungrier than ever for authentic products and services that truly deliver. Customersâ€™ tolerance and financial ability to enable the mediocre is fast waning. This is a time when the best will be rewarded with survival.
Third, thereâ€™ve been a lot of adjectives used to describe whatâ€™s happening in our economy. Iâ€™ve heard â€œcorrection,â€ â€œcrisis,â€ â€œadjustment,â€ â€œsuppression,â€ and â€œdepressionâ€ among others. Regardless, we (as in, the citizens of the U.S.A.) have been on an unsustainable path of consumption. You know thereâ€™s a problem when Salvation Army locations begin throwing away clothes; Iâ€™ve seen that happen multiple times, and have had my personal donations frequently rejected as well. It has to be healthy for our society to return to more modest consumption levels. This economic downturn will prompt that â€“ or, at least I hope it will.
Finally, a President Palin just wouldnâ€™t be good for any of us. Even if you support McCain dislike Obama, American voters must acknowledge that McCain is old and not really in tip-top shape. Moreover, fully one-third of U.S. presidents also served as vice president! That what-if, by itself, is a distraction and risk none of us need right now.
Weâ€™re going through a time of cleansing and reconciliation, but Iâ€™m optimistic. I have two kids in diapers, so I have to be.
How about you?