The great depression was that period which brought nothing but not so friendly environment for every company in the USA. Nowadays, the situation is not like that because the US economy is performing well, and there are no signs of great recession, but things like trade war have created a situation of panic. The USA is a country which is suffering from lots of trade disputes with many nations. Now geopolitical situations like a trade war are not suitable for the country because it somehow increases the chances of another recession.
Now during that time, what would Ad-based tech companies like Facebook and Google are going to do is the central question which many experts are worried about. Facebook and Google are those companies whose majority of the income comes from Advertisement, and during a recession, this sector is going to suffer the most. During the 2008 financial crisis, Google went through a similar situation because, at that time, Google was able to generate a significant amount of revenue from Ads.
It’s been observed that during 2008 crisis google’s majority of the revenue dropped. Advertisers were not able to pay higher money because they were not getting any consumers for their products even after spending millions of dollars on an Ad campaign. Facebook is the same company whose more than 99% of revenue comes from Ads, and they are quite vulnerable to another recession. When a recession hits, consumers aren’t able to purchase any goods or services because of high inflation and lower income. Now if a downturn hits the country, then another big company might get affected because of it, then it’s Amazon. However, the damage would be relatively less as compared to Google and Facebook because Amazon’s revenue from Ads constitutes less than 3%. However, it would be interesting to see how these big companies are going to manage an uncertain situation if they have to face it in the future.
William has an experience of more than seven years writing for the web. In the recent couple of years, he’s been focusing on the business sector, watching market trends and the growth of economies. At News IMN, we use his services to keep our readers updated about the market that decides their lives.