This post began as a comment on a post at Agency Spy.

But because I didn’t want to get on soapbox on their comments boards I posted it here.  This will explain the bulletpoints.  Read on people:

Small business has and will always be the backbone of US business.  Advertising is no different.  And as such there is still a ton of business out there to be had.  So the industry shrinks 10%. 15% 20%. That still leaves billions in advertising spending in this country.  Yes, even in this economy, good, creative marketing happens every day.  And pitches go to the ones who can demonstrate the smartest use and best value for their client’s dollars.

• Budgets are being cut: true
• Clients need to do more with less: true. By the way, they have no choice. Don’t you think they’d rather have $2 million for that campaign instead of $900K?
• If you wait around to be invited to a pitch by the large search firms you’re SOL: Mostly true – if you’re a small to midsized agency–you’re the first to go.

Advertising is changing (again).  Agencies need to change with it.  Smaller agencies are better positioned to be able to shift rapidly.  Adaptable, smaller agencies will see a disproportionate number of wins coming at them that before may have looked only at the large shops.

Historically agencies have done a really crappy job, operationally, of making meaningful changes that will position them to prosper when budgets constrict.  As agency people we don’t take our own advice!  If a client wouldn’t hear this–we’d declare them idiots and institutionally slow.

It also helps to have some perspective. 10 years ago when the dot com bubble burst, people were prognosticating doom and seeing whole revenue streams dry up.  What happened was new revenue streams began.  Even at a trickle it’s a great time to get on board with a client who you may have indentified in the past as not offering a big enough piece of pie to be worthy of your time.  Let the big guys kill each other over the multi million dollar accounts.  If a $25 million account is all you’re interested in, it may be a long time before you eat!

Here’s a brilliant little post about the cost of the Denny’s promo to feed everyone in America a free breakfast on Tuesday.  Of course he neglected to mention the cost of the superbowl spot.  But it makes for an interesting post!  

http://www.walletpop.com/blog/2009/02/02/math-says-dennys-free-breakfast-a-good-deal-for-the-company-to/

Despite the doomsday headlines everywhere you look, and I mean everywhere; and despite advertising spending projected to decrease in 2009 across every category except cable TV and Internet, US advertisers will still spend 258 billion marketing dollars* this year.  Divide that by the approximately 182,400 ad agency employees in the US and that’s about $1.4 million for every person currently working in advertising.  I’ll say that again, 1.4 million dollars per person.  Considering that those marketing dollars trickle into lots of other industries, that’s good news for everyone.  This is an exercise that can be applied to any industry you’re in. 

Granted, the above equation is purposely over simplified.  I’m playing loose with the numbers but it’s really just to make a point.  There is money to be made in advertising this year.  There is money to be made in every industry this year.  Everyone will be fighting a bit harder for their share of the pie, but your industry is not drying up and blowing away.  Well, unless you’re a newspaper.  And just to be fair, in an industry projected to have marketers spend $32 billion with them this year, that’s certainly not the death knell for newspapers either–a major shift, yes.  A coffin, no.  But that’s for another article.

It seems that every media outlet is running stories with comparisons to the depression and “worst since” scenarios.  Every breaking news story highlights another round of layoffs or the latest group asking the government for a bailout.  Not that we should bury our heads in the sand.  There is real danger in ignoring trends.  But there’s is significantly more harm in thinking every piece of bad news means something to your enterprise.

When money and markets tighten up, it’s an opportunity for those willing to make the most of a situation and see the chance instead of the challenge.  Many competitors who don’t have the stomach for the fight will leave the party.  As written in Advertising Age this week:

“Business runs in cycles. The recession means reduced consumption, but that creates pent-up demand that can help drive recovery. Marketers still in the game will have money to spend on advertising, promotion and other marketing programs. It will be up to media and non-media alternatives to make a play for those dollars.”

As my Grandfather used to say, “Keep your head down.”  This is certainly the year to be listening to ghosts of the greatest generation whispering in our ears.  They’ve been there.  They lived through times much worse that these.  And they prevailed and prospered.  So can we.

The best way I’ve heard this said is to find out “who has your money in their pockets?” and more importantly, “how do you get it into your pocket?”**

That’s what 2009 is really about.   The sky is not falling.  We are not all in trouble.  There is money to be made in your industry, whatever your industry. This is your year to find it. 

* Data as reported in Advertising Age’s Annual 2009 (Dec 29, 2008)

**Guy Kawasaki The Art of the Start p.14