Digital Ad Spend and the DisConnect

I've heard many within the industry say that the Digital ad space should be shielded from most of the experienced in the economy. After all, digital advertising is accountable, it takes less to attain that reach, there is no upfront commitment, etc. When money is allocated to marketing, it should be spent online first. So with the recent turn in economic conditions, in theory companies should be looking to spend money in marketing channels that are more efficient and accountable. Digital advertising spend should maintain consistency and maybe even experience some growth.

Lets look at how companies approach budget allocation for advertising. Most brands haven't achieved a method in quantifying the value and ROI of advertising. There is a disconnect between finance and marketing. The CMO and their team is responsible for the marketing/advertising but at the end of the day, the budget allocation for marketing comes from the finance group. The finance group generally does not have the same appreciation of the value of advertising and marketing. Without a reasonable measure of ROI, the general view of marketing from a finance's point of view is that its value can not be demonstrated, its spending becomes discretionary.

In Q4 2008, we've already seen many brands cut their already budget allocated ad spend for Q4. I am interested in hearing from people within finance on how the marketing budgets have been reallocated and what the mandates on budgets from management have been.