Why big companies cut everything but ad spending in 2013


According to a report from Kantar Media  the largest companies in the US made hiring and spending cuts across the board while boosting their spending on advertising for 2013. The Wall Street Journal noted that many companies are guarding their cash rather than putting it back into the economy in the form of new hiring.  There has also been a trend of growing distrust among consumers especially towards large corporations & one theory is that increased spending on advertising that highlights emotional and societal benefits could help combat this. Rance Crain from the Advertising Age noted that the automobile and airline industries have discovered they can make more money by having less product available. Advertising may be an important tool to communicate to consumers and clients that brands care about issues that are important to the community. In any case, there may be some truth to the old theory that in good times you should advertise and in bad times you must advertise.


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