Not all ad agencies are getting a fresh start to 2019. Some shops that count the federal government as a client could soon feel the financial strain of the shutdown, which is now nearing two weeks in length. Delayed payments, disrupted campaigns and the postponement of agency appointments are all potential outcomes should the shutdown continue, according to experts.
The U.S. government, which is number 46 on the list of leading national advertisers compiled by Ad Age's Datacenter, spent $949.3 million on total advertising in 2016, up 3.5 percent from 2015. More than half, or $500.5 million, of that budget was spent on measured media, Datacenter found. The government's largest advertised brands include the Army, Health & Human Services, U.S. Postal Service, Air Force and Navy.
"Shutdowns are bad for business no matter what business you're in," says Sam Berger, a senior advisor at the Center for American Progress, a think tank. He notes that in addition to delays in payments, the shutdown also creates "an inability to talk to the contracting agency about services to be provided and for those folks looking to get new work, no decisions can be made or contracts awarded until the shutdown is over."
The partial shutdown began Dec. 22 as politicians failed to reach a budget deal over border wall funding. This is the fourth-longest shutdown in history, according to CNN, which referenced a 21-day suspension in 1995 into 1996, as well as a complete shutdown in 2013.
Ad agencies working with the Department of Defense appear to be in luck — the president signed its appropriations bill in September. That means agencies like Omnicom's DDB, which won the high-profile Army account in November; JWT, the longtime agency for the Marine Corps; or GSD&M, which oversees advertising and special events for Air Force Recruitment, shouldn't face disruption in their work on those clients. Those agencies either couldn't be reached for comment or declined to comment.
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