News Corp CEO Robert Thomson has issued a dire warning to adland, saying the market is in turmoil as brands suffer from a lack of transparency and online traffic fraud.
In a speech following the release of News Corp’s results for the September quarter – in which it posted a headline loss of US$15 million ($19.5 million) and an 11 per cent decline in ad revenue – Thomson noted how automated ad buying was wasting money by putting advertisers on low-quality websites, according to The Australian.
“We are seeing… mayhem in the ad market”, he said, with “products bobbing around in bilge water”.
“Hype and hip are not alternatives for quality and integrity.
“In the middle of this commercial commotion, it is appropriate that ad agencies are under scrutiny as too much ad tech is fad tech.”
Thomson added that the crisis facing the ad market “can’t continue ad infinitum”.
According to The Australian, Thomson said News Corp’s newspapers remained focused on cost reductions and digital subscription growth.
News Corp Australia posted 283,800 digital sales at September 30 – up from 246,400 a year ago – and The Australian Financial Review reported that it will cut $40 million in costs (including jobs) this fiscal year to cope with falling ad revenue and the company’s continued shift to digital.