Brexit comes back to haunt UK newspaper titles
The post-Brexit aftershock is now starting to be felt by the advertising and marketing industry in the UK - and it could spread to Ireland
The significance of the phrase 'be careful what you wish for' obviously went whoosh over the heads of the editors and publishers of pro-Brexit UK titles such as The Sun, the Daily Express, the Telegraph and the Daily Mail in the run-up to their recent referendum.
Often pandering to the lowest common denominator and preying on the fears of the disconnected and the confused, these newspapers' role in influencing the 52pc of people who voted for Brexit will be seen by many critics as a profound act of stupidity and monumental irresponsibility.
At a time when there was an important need for clear and level-headed and informed debate throughout the media, their sensationalist and jingoistic anti-EU rants and stories about immigrants and EU gravy trains will have left a bitter taste in the mouths of readers who have now woken up with a nasty Brexit hangover that looks set to last for many years to come.
Of course there is nothing new about the British media's ability to sway voters and meddle in politics. Whole libraries could be filled with commentary on the role of the media in society and its ability to influence the electorate - often at the behest of some interfering political force, or a patrician publisher with an alternative agenda.
But this time around it was different. It wasn't just about favouring one political party or leader over another. At stake was the future of the UK economy, its citizens, and the future of the great European dream.
Just as the pro-Brexit press got what it wished for, it is now going to reap what it sowed as the aftershock is now starting to reverberate throughout the UK advertising sector - and indeed the wider marketing community.
It is somewhat ironic that among the first to feel the immediate pain will be the UK newspaper industry - and most likely the very titles that helped lead the electorate up the garden path. While a degree of schadenfreude may be felt among some Remain campaigners, the reality is that the UK newspaper sector was already facing into a turbulent future. And now the outcome of the referendum has pushed it even closer towards the precipice.
The UK media consultancy firm Enders Analysis, for example, has slashed its forecasts for the entire UK media industry for the next two years - with advertising revenues for newspapers forecast to decline by anything up to 25pc this year. Similar declines have been pencilled in for 2017.
After 2017, it's anybody's guess...
The outcome might ultimately depend on whether or not the UK slips into a full-blown recession. But there will almost certainly be major media casualties along the way.
The anticipated decline in advertising in the UK is attributable to a large degree of unease and uncertainty among global companies selling their products and services in Britain.
In any well-developed functioning economy, uncertainty is one of the great enemies of the marketplace. While it is still early days, Ireland is not immune to this uncertainty and there is a real threat of contagion spreading this side of the Irish Sea.
The most obvious Brexit aftershock is likely to be felt by Irish companies with a large exposure to the UK market - particularly those in the food and drink sectors. If the UK economy does go into a tailspin, these companies will almost certainly be forced to reduce their marketing investment in Ireland, and indeed the UK, says Ciaran Cunningham, CEO of the Dublin-based media agency Carat.
"Uncertainty does not create a healthy environment in which companies [can] make clear future investment decisions, and the Brexit result is not good for the Irish advertising economy," he says.
From an Irish perspective, one of the more worrying trends that emerged during the last economic downturn was the hasty retreats made by a number of brands and their marketing departments back to the UK.
This had the effect of marginalising Ireland as a region - putting it alongside the likes of Greater Manchester in terms of size and relevance.
In addition, advertising investment decisions for a number of global brands are still made in the UK and some Irish media companies (RTE being a prime example) derive as much as 10pc of their advertising revenues from there. Given sterling's recent plunge, the next 12 months could prove to be tricky for everybody.
"The fall in the value of sterling could also contribute to any cuts in marketing and advertising budgets," adds Cunningham.
But it may not be all doom and gloom either and there are positives, and indeed opportunities, he says.
"If Brexit does mean an increase in FDI into Ireland, that could have a positive impact on the Irish advertising economy. But also, while the Brexit result had an immediate negative effect on the UK advertising market, it should be noted that this has not happened in Ireland - and the outlook over the shorter term remains broadly positive," he says.
Sunday Indo Business