Marketing Briefing: Why marketers aren’t focused solely on ‘use it or lose it’ spending in Q4 anymore

And ever when it does, there’s also much more investment rigor required. Marketers are usually asking ad buyers to find more performance-driven ways to spend that will help them hit sales targets rather than simply parking the ad dollars somewhere to avoid losing it next year at the hands of chief financial officers eager for cost reductions, according to seven ad buyers Digiday spoke to for this story. 

But as marketers’ ad budgets have continued to be squeezed and the focus on performance has continued to rise as well as the ability to track day-to-day performance across various platforms has become the norm, there’s overall more accountability for ad buyers. With that being the case, there’s a sense that even during the “couch cushion” spending season, as a few ad buyers dubbed it, there’s more accountability in how that’s spent now too. 

“Historically, we used to get like a million dollar last minute asks in the year to ‘use it or lose it,’” said Mike Feldman, svp and global head of retail media at Vayner Media. When last minute asks do come in, marketers are focused on finding ways to account for that spending rather than simply spending. “Now we are getting last minute asks on how we can hit sales numbers.”

Zach Ricchiuti, client solutions, associate vice president, at Kepler, echoed that sentiment. “Early on in [my] career, that would happen all the time,” he said. “At the end of the quarter, our clients would come to us and say, ‘We have a million dollars. [There are] three days left in the quarter. We need to spend this now, or else we’re going to lose it.’ That just doesn’t really happen anymore. Or at least… it certainly hasn’t happened this year.” 

Examples of more accountable extra budget spending include turning on creator affiliates or turning on more channels in the Amazon DSP or testing out retail media channels like Costco, to name a few examples that buyers may have suggested to marketers for this year’s limited extra spending. 

This time of year marketers have an even more performance only mindset than usual, thinking of ways to “juice your performance machine,” noted the first anonymous ad buyer, who said that more creative ideas often tend to fall off if they don’t hit an activation checklist that proves they will definitely boost performance and be able to do so easily. Per the buyer, that checklist includes questions like: “Can we get this budget out the door in the amount of time needed? Do we have the assets to make it work? Does this require additional approval cycles from the creative team or client team?”

Marketers want to drive action with their ad dollars so rather than telling ad buyers to “try something new they’ll say let’s put it against something that’s tried and true that’s performed for us in the past and we have confidence in,” said Jennifer Kohl, chief media officer at VML. “It’s not necessarily a net new partner or net new media channel.” 

That said, the fourth quarter is already a high stress period for agencies and the added stress of not only finding ways to spend last minute ad dollars but finding quick and nimble ideas that will hit sales goals can be tricky. 

“Across the board, clients have become much more conservative [in their spend],” said a second ad buyer who requested anonymity. 

That will likely only continue next year, but media buyers hope marketers will start planning earlier and have contingency plans in place in case they do have extra spend so that they are able to activate quickly and get alignment. Doing so this time of year is particularly fraught so having plans in place ahead of time should there be extra spend is the most effective approach, according to buyers.

Sam Bradley contributed reporting.

3 Questions with David Telfer, head of Lexus Advertising & Media

Lexus’ “December to remember” seasonal sales campaign has been running for 25 years now. The media landscape was pretty different back in 1999.

We’ve certainly changed it over time. Our latest broad broadcast spots run across cable sports and we really try to focus on highly visible sports programming like Sunday Night Football, Amazon’s Thursday Night Football, college football, the NHL and the NBA. [The focus on sports] has been a goal of Lexus’ advertising for the last couple years. I can’t share the actual [media budget] breakdown, but it’s heaviest in broadcast spots and social media.

Which social platforms does Lexus focus on for paid social?
We run digital content across all social media platforms, but this year we’re excited to partner with a couple of content creators for some unique holiday themed projects. We’re doing a lot of that on TikTok.

Any worries regarding the kind of question marks over TikTok’s continued existence in the U.S.?
That’s certainly a hot topic across advertising and media channels. Specific for this “December to Remember” event, we’re comfortable partnering with them, because they’re going to be around at least for the remainder of this specific campaign. — Sam Bradley

By the numbers

European CMOs don’t think the economic situation will improve next year, according to a survey of top marketers in 11 markets — including Germany, Britain, France and the Netherlands — conducted by German agency network Serviceplan.

Fifty-one percent of the 835 marketers surveyed said they didn’t expect the economic circumstances facing their brands to improve or worsen next year. Twenty-three percent said they thought the situation would worsen, up 2% on last year, while only 21% said the economy was likely to get better — down 8% on last year. The survey also found:

• 0% of marketers surveyed in Germany and the U.K. thought the economy was likely to improve next year. Happy new year, everyone!
• 37% of marketers surveyed said they expected their marketing budgets to increase next year. 36% said theirs would stay the same, while in the U.K., 44% said they expected spend to rise.
• Only 23% said that sustainability was a “very important” focus for them; AI agents (31%), pricing (27%) and marketing automation (29%) each registered as higher priorities. — Sam Bradley

Quote of the week

“The conversation now is, ‘I want to see your AI staffing plan’ and ‘I want to see specifically the people that are working on my business that are AI pilots’ and ‘What stack of tools they’re going to be using on my business?'”

— An agency founder and CCO when asked about AI’s threat to junior creatives.

What we’ve covered

• Assessing the fallout of Google’s ad tech antitrust trial
• Creator agencies have embraced AI, but is the tech changing marketers’ minds?
• Ahead of its January launch, brands line up to get involved with new ESPN golf league TGL