Tim Kendall, monetization director at Facebook, is one of the first guys we've heard concede that the online ad market could be vulnerable to a recession.
"It's pretty clear that when consumer confidence is down, brands cut back on [advertising spending]. Social media spending was considered experimental, and therefore ad spending came out of discretionary budgets, but as it's becoming less discretionary, you need to deliver a demonstrable ROI [return on investment]. . . I think it's going to be a challenge for us," Kendall said while speaking at Dow Jones VentureWire's Web Ventures 2008 conference in Redwood City.
Meanwhile, Google CEO Eric Schmidt flits about, making up reasons why Google is invincible. Yesterday he said the company is protected from a recession since it's not dependent on any specific advertising sector. He used a different story on Monday, while speaking in China, when he argued that Google would be insulated because of its robust international operations.
(Incidentally, Google hasn't set the date for its first-quarter results, but they were released on April 19 last year, so we'll probably hear very soon just how untouchable the company is.)
On the Beacon fiasco, Kendall also had an interesting take: "The biggest misunderstanding about Beacon is that it has anything to do with advertising," he said. "We made a mistake in launching it concurrently with our ad network."
Asked about the adoption of Beacon, Kendall says all the negative press stalled progress on the product.
"We only have a couple dozen partners generating a couple thousand actions a day," he said.
