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"Exhibit I " / (Ad Age) Advertising Blues...More Headlines 2007 (Stories #131 - #150)
     
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PODCAST: NATPE Explores the Many Sides of Consumer-Created Content / Issues That Worried Many at the Conference

By Hoag Levins / Published: January 22, 2007

 

NEW YORK (AdAge.com) -- A buzzword as well as a headache pressing ever more painfully on broadcast and cable TV networks, consumer-created content is rapidly rising as potentially as sweeping and transformative a force as the initial emergence of the internet itself.

 

As this podcast indicates, the issues surrounding consumer-created video were high on the minds of attendees and speakers such as Wired magazine editor in chief Chris Anderson at last week's National Association of Television Programming Executives (NATPE) conference in Las Vegas.

 

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Showdown Looms in Congress Over Drug Advertising on TV

By MILT FREUDENHEIM / Published: January 22, 2007

 

Direct-to-consumer pharmaceutical advertising campaigns, such as this 2005 television commercial for Enbrel from Amgen, are being scrutinized by the Food and Drug Administration over the claims they make.

 

Drug advertising aimed at consumers, a fast-growing category that reached $4.5 billion last year, will face hard scrutiny in the new Congress, according to industry critics in both the House and Senate.

 

The government was displeased with claims in a 2005 AstraZeneca Crestor commercial in 2005. The consumer ads will be on the griddle early in this session at hearings on the user fees that manufacturers pay to speed the reviewing of new drugs by the Food and Drug Administration. The user fee law will die in the fall unless Congress acts to renew it.

 

The pharmaceutical industry, which often gets what it asks for from Congress and the executive branch, seeks to renew the law and add a new set of user fees that would be pay salaries for additional F.D.A. employees to evaluate all consumer drug ads, before they are shown on television.

 

Both the industry and its critics agree that there should be a pause before the advertising starts — to allow time for doctors to learn about a new drug. The companies want the delay to be left up to them, but critics say the F.D.A. should require a wait of up to two years. Criticism of direct-to-consumer advertising has intensified since 2004, after Merck withdrew Vioxx, a heavily advertised painkiller, after a clinical trial showed that it sharply increased the risk of heart attacks and strokes.

 

“From the beginning , everyone, including the company, agreed that not everybody ought to be getting Vioxx,” said Helen Darling, president of the National Business Group on Health, an organization of large employers. “But the ads implied there was a widespread need for it.”

 

Spending on consumer drug advertising, meanwhile, has been growing robustly, from $1.1 billion in 1997 to $4.2 billion in 2005, according to a recent report to Congress by the Government Accountability Office. In the first nine months of 2006, spending rose 8.4 percent to $3.29 billion, on track toward $4.5 billion for the year, according to TNS Media Intelligence, an advertising research firm.

 

Spending on the ads faltered in 2005 after soaring 27 percent in 2004, before Vioxx was withdrawn, said David Kweskin, a senior executive at the firm. “Now they are in a catch-up phase.”

 

Two independent government watchdog groups sharply criticized consumer drug advertising recently, and a separate survey Jan. 9 commissioned by the PricewaterhouseCoopers accounting and consulting firm indicated that skepticism is widespread among the public, too. Only 1 in 10 consumers said the direct-to-consumer, or D.T.C., ads could provide useful information to a large audience, the survey said. (Consumer drug advertising is not permitted in most of the world, except New Zealand and the United States.)

 

The pharmaceutical industry itself acknowledges having an image problem.

 

“It would be naïve to not acknowledge the fact that D.T.C. advertising is also a lightening-rod in the health care debate in this country,” said Billy Tauzin, the former congressman who is now president and chief executive of the Pharmaceutical Research and Manufacturers of America, in a speech to venture capitalists last spring. There is “one great problem” that the manufacturers face, he said: “in a word, it is trust.”

 

“While individual patients find the information useful in discussions with their physicians,” he added in his speech, “patients, physicians and consumers generally express unhappiness with D.T.C. advertising.”

 

Mr. Tauzin’s organization issued voluntary guidelines for consumer ads, which took effect last year. Under the guidelines, the companies have promised to hold off on consumer advertising of a new medicine for an unspecified “appropriate” period. That would allow time to tell doctors about risks and benefits, before television and Web site viewers see an ad and demand a prescription.

 

Twenty-seven members of the pharmaceutical manufacturers organization have endorsed the guidelines, but it is hard to figure exactly how long the delays in advertising will run. Bristol-Myers Squibb has said that it would delay for 12 months. Johnson & Johnson and Pfizer said they would wait six months. The manufacturers group cannot say how other companies have interpreted the guidelines, a spokesman said.

 

But according to TNS Media Intelligence, the companies have actually been waiting 15 months, on average, since the Vioxx debacle.

 

Critics say that even after F.D.A. approval, the full safety profile of a new drug cannot be known until it has been widely used for a number of years.

 

But the manufacturers’ guidelines have to be voluntary, said Daniel E. Troy, a former chief counsel of the F.D.A., because the Supreme Court has “struck down restrictions on advertising of tobacco, alcohol, gambling and unapproved compounded drugs.”

 

The agency sent 15 warning letters to drug companies regarding ads in 2005 and a total of 22 complaints last year.

 

The F.D.A. told AstraZeneca, for example, to “immediately cease” a “misleading superiority claim” in a 2005 TV commercial. The ad said AstraZeneca’s Crestor was “clearly the best” in a “head to head” test with the three largest-selling cholesterol drugs.

Emily Y. Denney, an AstraZeneca spokeswoman, said that by the time the letter was received, in March 2005, the ads were no longer running. The company defended its message in the advertising as “appropriate.”

 

Another F.D.A. letter told Amgen, a biotechnology company, to stop running commercials for Enbrel, a treatment for the skin disease psoriasis, that the F.D.A. said minimized “serious risks” associated with the drug. Amgen immediately withdrew the commercial.

 

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Wendy's Taps Publicis Shops for $300 Million Account / Saatchi Takes Creative, MediaVest Gets Buying and Planning Duties

By Brooke Capps and Lisa Sanders

 

Published: January 24, 2007

 

NEW YORK (AdAge.com) -- Wendy's is moving its $300 million creative account from Interpublic Group of Cos.' McCann Erickson to Publicis Groupe's Saatchi & Saatchi, and Saatchi sibling MediaVest will handle media buying and planning responsibilities, the marketer said today.

The fate of the Wendy's account has been hotly speculated for more than a year.

 

The media incumbent was Interpublic's Universal McCann. Wendy's also said MDC Corp.'s Kirshenbaum Bond & Partners will work on designated creative projects.

 

Year of speculation

The fate of the account has been hotly speculated about for more than a year. A number of agencies have met with Ian Rowden, senior VP-chief marketing officer, according to these executives. A Wendy's spokesman couldn't be reached, but Mr. Rowden, contacted by cellphone, refused to comment, saying he was in a meeting.

 

The agencies referred calls to the marketer and a Wendy's spokesman declined comment.

 

According to one executive familiar with situation, Mr. Rowden declined the traditional pitch process in favor of a series of meetings with agencies, in which each agency presented past work and talked a little about ideas for the client. "They picked an agency and not a campaign and that is how you should find an agency," said the executive.

 

Wendy's spent $387 million in measured media in 2005 and $290 million from January through September 2006, according to TNS Media Intelligence. With only national and some cable responsibilities, McCann Erickson and Universal McCann handled about half of that media outlay.

 

Good end after bad start

Wendy's rival and market leader McDonald's today reported record earnings for 2006. Wendy's, the No. 3 fast-food chain (behind Burger King), on Jan. 5 posted improved same-store sales during the fourth quarter of 2006, though last year started out disastrously, with negative same-store sales in the first half. Those results had compounded an already bad situation, as 2005 ended with losses. That poor performance prompted a franchisee revolt, and activist investor Nelson Peltz won seats for himself and two disciples on the company's board. Last April, Chairman-CEO Jack Schuessler was ousted.

 

Kerri Anderson, named CEO-president in November after serving as interim chief for several months, reshuffled management and marketing, trimmed employees and shed assets to cut $100 million in costs.

 

While Wendy's same-store sales have turned positive, executives close to the matter said franchisees remained unhappy with sales, given its long drought and the improved sales at rival burger chains. "How long can you be down," asked one industry observer.

 

Vidal Partnership, an independent agency based in New York, retains duties for Hispanic marketing.

 

Kate MacArthur and Matthew Creamer contributed to this report.

 

Google Video, YouTube to Remain Separate Operations / Search Giant to Have Its Properties 'Play to Their Respective Strengths'

By Abbey Klaassen  / Published: January 25, 2007

 

NEW YORK (AdAge.com) -- Google unveiled the first integration between Google Video and YouTube today, when it announced it was adding YouTube video results to its Google Video search index.

 

The company issued a statement to update the status of Google Video and YouTube and said the two services would remain largely independent and "play to their respective strengths." For YouTube, that is remaining the destination for uploading, viewing and sharing videos; for Google Video, that remains search and creating new video technologies.

 

Video search destination

So it would appear Google Video is viewed less as an online video viewing destination and more primarily as a video search destination.

 

Google purchased YouTube for $1.65 billion in early October. The deal closed mid-November but the companies have, until now, stayed relatively mum on whether they would remain entirely independent or work together. Some have even suggested Google should merge Google Video into the more popular and widely known YouTube. It appears the answer to that question lies somewhere in the middle of range of speculation.

 

Google will offer YouTube access to search and monetization platforms -- although the statement didn't indicate what exactly that monetization would look like. Currently, YouTube has sold branded channels and worked with advertisers to sponsor user-generated content contests. It has also worked with TV networks and movie studios to help promote programs and films and offers advertisers the opportunity to buy plum front-page placement. It recently signed a deal with Verizon that offers a subscription mobile service.

 

"Ultimately, we envision most user-generated and premium video content being hosted on YouTube so that it can further enhance the YouTube experience," the statement read. "We also envision YouTube benefiting from future Google Video innovations -- especially those involving video search, monetization and distribution."

 

For Super Bowl Buy, Think Local / With Six Days to Go, Spots Still Available at Affiliates

By Claire Atkinson  / Published: January 25, 2007

 

NEW YORK (AdAge.com) -- With six business days to go until Super Bowl Sunday, the CBS TV Stations group has two to three spots left in each of its local markets for advertisers seeking to take advantage of cheaper local ad buys than coughing up $2.6 million for a national buy.

To get around Anheuser-Busch's beer stranglehold on the Super Bowl in 2005, Heineken found airtime for its ad with Brad Pitt on local affilaites.

 

According to executives on both the sales and buying side of the big game, the priciest 30-second spots are selling for around $300,000, and, not surprisingly, the most expensive local market is Chicago, as the hometown Bears are squaring off against the Indianapolis Colts. Audience levels are expected to be highest those two markets.

 

Good matchup for CBS

The matchup is good news for CBS, which owns its affiliate station in the Chicago market. Julio Marenghi, president-ad sales at the CBS TV Station group, said most new money had come from advertisers that had negotiated a contingency clause that stipulated they would buy time in the game if certain teams reached the final. Otherwise, he said he hasn't experienced a surge of last-minute buys and that he expects local sales will be wrapped up next week.

 

Marketers who can't buy into the big game because of category exclusivity clauses can get around that restriction by doing a local buy. In 2005, Heineken got around Anheuser-Busch's dominance of the beer category on the national level with a huge local spot buy for its ad featuring actor Brad Pitt on local Fox stations. Fox aired the Super Bowl last year.

 

"There are people who wait to see who the teams are to see if [the game is] going to be exciting," said Kathy Crawford, president-local broadcast at MindShare Worldwide.

 

Tough to get around exclusivity

But it might be tougher this year to orchestrate a local buy to get around exclusivity, because CBS owns many of its affiliates in major markets, Ms. Crawford said, and it will likely restrict those stations from selling ads to competitors of marketers that have already bought airtime on a national level.

 

CBS owns stations in Austin, Baltimore, Boston, Chicago, Dallas, Denver, Detroit, Green Bay, Los Angeles, Miami, Minneapolis, New York, Philadelphia, Pittsburgh, Sacramento, Salt Lake City and San Francisco.

 

While a local buy might seem like good value, Ms. Crawford said its important to realize that marketers aren't simply buying an in-game spot from the local affiliate, because affiliates often only allow buys in a package of spots that include pre-game, post-game and possibly other nights in prime-time that week. Marketers need to be prepared to factor that into their buys, she said.

 

Now that the matchup is decided, a number of marketers have chosen to publicize their participation in the game, including Walt Disney Co., InfoUSA's SalesGenie.com, Sprint and Coca-Cola Co. On a national level, CBS said it is 85% sold and is tying up a variety of negotiations.

 

Marketers gauge interest

JoAnn Ross, CBS president-ad sales, said yesterday at a Super Bowl panel, "Like any other event, like the Academy Awards, people want to wait to the last minute to see if they are going to get a discount. What has happened this year is that after our championship game on Sunday, which had one of the biggest ratings in years, there has been a lot of fresh interest."

 

The National Football Conference game on Fox between the Chicago Bears and the New Orleans Saints drew 43.2 million views and a 25.1 rating. The big numbers point to a huge interest in the Feb. 4 Super Bowl. Meanwhile, 46.7 million viewers tuned into CBS to watch Colts make it past their American Football Conference nemesis New England Patriots, the most-watched AFC championship since 1986.

 

"It might be a very intelligent thing for CBS to tell people how well the games did last Sunday," said Aaron Cohen, senior VP-director of national broadcast at Horizon Media.

 

CBS also has plans to involve its star news anchor Katie Couric in its Super Bowl coverage. Ms. Couric, who hosts the "CBS Evening News," will be featured in the pre-game package of events.

 

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PODCAST: NATPE Explores the Many Sides of Consumer-Created Content / Issues That Worried Many at the Conference

By Hoag Levins / Published: January 22, 2007

 

NEW YORK (AdAge.com) -- A buzzword as well as a headache pressing ever more painfully on broadcast and cable TV networks, consumer-created content is rapidly rising as potentially as sweeping and transformative a force as the initial emergence of the internet itself.

 

As this podcast indicates, the issues surrounding consumer-created video were high on the minds of attendees and speakers such as Wired magazine editor in chief Chris Anderson at last week's National Association of Television Programming Executives (NATPE) conference in Las Vegas.

 

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Showdown Looms in Congress Over Drug Advertising on TV

By MILT FREUDENHEIM / Published: January 22, 2007

 

Direct-to-consumer pharmaceutical advertising campaigns, such as this 2005 television commercial for Enbrel from Amgen, are being scrutinized by the Food and Drug Administration over the claims they make.

 

Drug advertising aimed at consumers, a fast-growing category that reached $4.5 billion last year, will face hard scrutiny in the new Congress, according to industry critics in both the House and Senate.

 

The government was displeased with claims in a 2005 AstraZeneca Crestor commercial in 2005. The consumer ads will be on the griddle early in this session at hearings on the user fees that manufacturers pay to speed the reviewing of new drugs by the Food and Drug Administration. The user fee law will die in the fall unless Congress acts to renew it.

 

The pharmaceutical industry, which often gets what it asks for from Congress and the executive branch, seeks to renew the law and add a new set of user fees that would be pay salaries for additional F.D.A. employees to evaluate all consumer drug ads, before they are shown on television.

 

Both the industry and its critics agree that there should be a pause before the advertising starts — to allow time for doctors to learn about a new drug. The companies want the delay to be left up to them, but critics say the F.D.A. should require a wait of up to two years. Criticism of direct-to-consumer advertising has intensified since 2004, after Merck withdrew Vioxx, a heavily advertised painkiller, after a clinical trial showed that it sharply increased the risk of heart attacks and strokes.

 

“From the beginning , everyone, including the company, agreed that not everybody ought to be getting Vioxx,” said Helen Darling, president of the National Business Group on Health, an organization of large employers. “But the ads implied there was a widespread need for it.”

 

Spending on consumer drug advertising, meanwhile, has been growing robustly, from $1.1 billion in 1997 to $4.2 billion in 2005, according to a recent report to Congress by the Government Accountability Office. In the first nine months of 2006, spending rose 8.4 percent to $3.29 billion, on track toward $4.5 billion for the year, according to TNS Media Intelligence, an advertising research firm.

 

Spending on the ads faltered in 2005 after soaring 27 percent in 2004, before Vioxx was withdrawn, said David Kweskin, a senior executive at the firm. “Now they are in a catch-up phase.”

 

Two independent government watchdog groups sharply criticized consumer drug advertising recently, and a separate survey Jan. 9 commissioned by the PricewaterhouseCoopers accounting and consulting firm indicated that skepticism is widespread among the public, too. Only 1 in 10 consumers said the direct-to-consumer, or D.T.C., ads could provide useful information to a large audience, the survey said. (Consumer drug advertising is not permitted in most of the world, except New Zealand and the United States.)

 

The pharmaceutical industry itself acknowledges having an image problem.

 

“It would be naïve to not acknowledge the fact that D.T.C. advertising is also a lightening-rod in the health care debate in this country,” said Billy Tauzin, the former congressman who is now president and chief executive of the Pharmaceutical Research and Manufacturers of America, in a speech to venture capitalists last spring. There is “one great problem” that the manufacturers face, he said: “in a word, it is trust.”

 

“While individual patients find the information useful in discussions with their physicians,” he added in his speech, “patients, physicians and consumers generally express unhappiness with D.T.C. advertising.”

 

Mr. Tauzin’s organization issued voluntary guidelines for consumer ads, which took effect last year. Under the guidelines, the companies have promised to hold off on consumer advertising of a new medicine for an unspecified “appropriate” period. That would allow time to tell doctors about risks and benefits, before television and Web site viewers see an ad and demand a prescription.

 

Twenty-seven members of the pharmaceutical manufacturers organization have endorsed the guidelines, but it is hard to figure exactly how long the delays in advertising will run. Bristol-Myers Squibb has said that it would delay for 12 months. Johnson & Johnson and Pfizer said they would wait six months. The manufacturers group cannot say how other companies have interpreted the guidelines, a spokesman said.

 

But according to TNS Media Intelligence, the companies have actually been waiting 15 months, on average, since the Vioxx debacle.

 

Critics say that even after F.D.A. approval, the full safety profile of a new drug cannot be known until it has been widely used for a number of years.

 

But the manufacturers’ guidelines have to be voluntary, said Daniel E. Troy, a former chief counsel of the F.D.A., because the Supreme Court has “struck down restrictions on advertising of tobacco, alcohol, gambling and unapproved compounded drugs.”

 

The agency sent 15 warning letters to drug companies regarding ads in 2005 and a total of 22 complaints last year.

 

The F.D.A. told AstraZeneca, for example, to “immediately cease” a “misleading superiority claim” in a 2005 TV commercial. The ad said AstraZeneca’s Crestor was “clearly the best” in a “head to head” test with the three largest-selling cholesterol drugs.

Emily Y. Denney, an AstraZeneca spokeswoman, said that by the time the letter was received, in March 2005, the ads were no longer running. The company defended its message in the advertising as “appropriate.”

 

Another F.D.A. letter told Amgen, a biotechnology company, to stop running commercials for Enbrel, a treatment for the skin disease psoriasis, that the F.D.A. said minimized “serious risks” associated with the drug. Amgen immediately withdrew the commercial.

 

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YouTube gives Consumers the power to make or Break a Brand ; ON ADVERTISING

Jan 15, 2007 - Independent-London / Author(s): Claire Beale

 

There are people out there who think that truth in advertising is as much of an oxymoron as an honest politician. Really. Ad execs don't come bottom in the honourable profession stakes for nothing; used-car salesmen and estate agents are generally considered more believable.

 

Beauty brand Dove has built an entire market out of exploiting this view. Its "Real Women" campaign has tried to unpick the (lazy) conventions of the beauty ad industry and put the truth back into advertising. It's been a very successful strategy and has won marketing and advertising awards the world over.

 

You've almost certainly seen some of the ads (they're so different that they really stand out: fat women in their undies and proud of it). But there was a US viral released last year which sums up the approach. It shows how a rather ordinary-looking woman undergoes a total (computer-enhanced) transformation in the name of advertising. For anyone who has ever felt even vaguely inadequate when faced with perfect people in glossy ads, the Dove film Evolution on YouTube is required viewing.

 

Anyway, now Dove is going further and throwing its brand name into the thick of the user-generated advertising debate. It's a hot topic amongst marketers generally. A couple of weeks ago, I wrote in this column about how the internet was helping democratise advertising: ads are no longer the preserve of the advertising agency and punters are having a go themselves, making films about brands and posting them on sites like YouTube. Incidentally, someone's made a brilliant spoof of Dove's Evolution, called Anti- Dove Parody, showing a beautiful man guzzling beer and burgers until he becomes a hideous slob.

 

That's user-generated advertising for you.

Some advertisers feel deeply uncomfortable about all of this. Coca-Cola went excruciatingly corporate when its customers started posting films showing bottles of Diet Coke exploding under the influence of a packet of Mentos mints: "Coca-Cola is for drinking, not playing with" summed up Coke's response.

 

No such po-faced behaviour from Dove, though. Dove "wants you to create its next great television ad" for its cream-oil range; and proclaims ,"it's easier to create your own ad than you think," (which raises some interesting questions about how much Dove pays its ad agency Ogilvy for its work). Dove will then screen the best user-generated entry in an ad-break during the Oscars.

 

This is a really smart strategy: not only does it give Dove credentials amongst the YouTube generation, but it also creates a high-profile, PR-laden and extremely cost-effective ad campaign. And the entries will no doubt throw up some interesting consumer insights, too.

 

This is modern marketing in the digital age and allows Dove to play the user-generated game with all the kudos that brings without ceding control. Where it all leaves the ad agency creative department, though, is another thing altogether.

 

TALKING ABOUT truth in advertising, if you're cynical enough to believe this is a deeply cynical industry, check out a couple of films on YouTube. One old, one new, this is ad-land at its most cynical, superficial and hilarious. The first, Truth in Advertising, is a few years old now, and particularly North American. It's about the making of an ad, from briefing to the director's cut, and everyone in it talks, well... the truth.

 

So the marketing director says: "I like making decisions on multi- million dollar campaigns by basing it on what my peabrained, disinterested wife thinks about it"; the creative team admits, "we're two untalented hacks riding on the success of a campaign we lucked into four years ago".

 

This film takes dialogue that has run through the heads of a million ad execs around the world, and speaks it. It's made by the Canadian commercials production company Avion Films, so you have to think they know what they're talking about.

 

Now there's a new film out by a British team on a similar theme. This one's called Truth in Ad Sales and the viral has spent the last week going through adland like a batch of dodgy oysters.

 

It's a shameless, paler rip-off of the original, set this time in adland's media world, and it employs the same tell-the-truth device (media buyer to pa: "I'm going to tell you I DJ at the weekends, when really I queue up outside Chinawhite begging to be let in, before I get a night bus home to my mum's for a quick wank and a Horlicks."). Again, the film has been made by a team of people who work in the industry, and it's in this week's top 10 comedy films on YouTube. This time the client is a nappy-rash cream, Kiddi Care, and the hapless media agency comes up with a strategy that sees Kiddi Care sponsor an extreme sports show.

 

The strapline is genius: "Feel the rush, cure the rash."

 

Both these films enshrine universal truths about people in the business. And they're not a bad introduction to adland's worst practices and what your colleagues really think of you.

 

REGULAR READERS will remember last week's story of the Asda review: a creative pitch called by the supermarket giant's new marketing director Rick Bendel, who joined the company from its ad agency Publicis last autumn.

 

Bendel was the man responsible - to a greater or lesser extent, depending on who you believe - for Asda's advertising at Publicis. His decision to review seemed like a kick at his own advertising strategy.

 

Anyway, last week Bendel sealed the drama by snatching the entire [pound]44 million account from his old agency, which had held the business for 17 years. The winner is Fallon, Campaign's Agency of the Year, and apparently Fallon has come up with a stunning new strategy for Asda (expect the death of the arse-slapping "Asda- price" routine).

 

You can't fault Bendel's choice of agency. Fallon is on a high - this is the agency responsible for the Sony Bravia ads that have swept creative awards and caught people's imagination. But the power- play is fascinating.

 

As you might expect, Publicis insiders reckon it's Bendel's fault that Asda's ads have ranged from forgettable to excruciating, and he's now under pressure to deliver something stunning. If he had decided to stick with Publicis and turn the strategy around, the question would be why Publicis never managed to deliver great work while he was there. What is also true, though, is that Bendel knows where Publicis's weak points are and what the agency is capable of, or not.

 

By appointing Fallon, Bendel is making a clean break of it and, as I said, Fallon is a trophy agency right now. But Fallon could do worse than have a quiet word with their Publicis Groupe cousins, Bartle Bogle Hegarty. BBH had the Asda business in the 1980s and it nearly broke the agency: retail clients are notoriously difficult to handle and often culturally opposed to the ethos of a great creative agency.

 

If Fallon can deliver what Bendel's after and still retain its hot-shop credentials, then this could be a persuasive early bid for the Agency of the Year accolade once again.

 

Claire Beale is editor of 'Campaign'

 

BEALE'S BEST IN SHOW: NHS ANTI-SMOKING CAMPAIGN

 

New year's resolutions are a time-honoured tradition. Giving them up within a fortnight is another. This ad from Miles Calcraft Briginshaw Duffy hopes to persuade people to give up smoking by underlining the strength of nicotine's physical hold over its addicts. Giant fish hooks snare unsuspecting smokers and lure them to the nearest packet of fags.

 

It's a powerful image, though not as gruesome as some anti- smoking campaigns. It lacks the impact of ads featuring real-life cancer victims or the ones that show how nicotine clogs arteries.

 

Apparently, the average smoker feeds their habit with about 5,000 cigarettes a year, a phenomenal amount and a fact that, I suspect, most smokers are in denial about. Although this ad might not be as gruesome as its predecessors, for anyone whose new year's resolution is wavering, it's a strong reminder of the physical as well as psychological battle you need to wage against the addiction.

 

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Fed-up Agencies Quit Punching the Clock / Following in Crispin's Footsteps, Shops Charge for Ideas Instead of Time

By Lisa Sanders and Alice Z. Cuneo / Published: January 22, 2007

 

NEW YORK (AdAge.com) -- Crispin Porter & Bogusky's bold deal with Haggar, struck last year, in which the agency took an equity stake as part of its compensation, stood out as a rare exception from the sad status quo of agencies selling ideas as if they were pork bellies to be traded by the ton. "We're in the intellectual-property business," Crispin's Jeff Hicks said at the time. "We don't sell time."

Rob Siltanen, chairman-chief creative officer, Siltanen & Partners, owns the rights to the wee wisecracker Baby Bob.

 

Agencies have long rued compensation arrangements that see them sized up by the number of man-hours they commit to solving a marketer's problems rather than by the success of their solutions. And, as consumer-empowering technologies such as DVRs put a premium on agencies' ability to produce engaging content, they've created an increasing number of entertainment properties, but they very rarely get to own them. Now, finally, that is starting to change, and others are adopting a Crispin approach, according to experts involved in crafting agency-advertiser compensation contracts.

 

Innovation reaches critical mass

"The discussion is beginning to shift from 'What does it cost to generate work and services a client wants?' to 'What is the value of the services and materials the agency is creating for the client?"' said Ronald Urbach, partner, Davis & Gilbert. "Innovation is reaching a critical mass."

 

Like Crispin, Anomaly, the New York-based boutique started by ex-TBWA executive Carl Johnson, eschews time sheets and instead gets paid for a variety of activities. "We price ourselves on the subjective theory of value," said partner Jason Deland. "That allows us to structure more varied, entrepreneurial compensation agreements." With client Virgin America, for instance, Anomaly is helping design an in-flight entertainment system that will contain content and be commerce-enabled. The company will get a percentage of the revenue from the system's sales.

 

Missed opportunities

One of the sorrier catalysts, from the perspective of older general-market agencies, is a long list of missed revenue opportunities. Goodby, Silverstein & Partners, San Francisco, which developed the "Got Milk?" campaign in 1993, reaped no extra benefits from the millions of dollars in licensing fees and royalties generated after the campaign's launch. McCann Erickson created the concept for client Staples' plastic Easy Button, a $4.99 gadget that's sold more than 1 million units since its launch in January 2005, but received no financial reward beyond its original fees.

 

"We certainly hope the agency will develop alternative revenue sources for our clients," said Harold Sogard, partner and general manager at Goodby. However, he said, when creative produced for a marketer goes beyond its original intention of selling a product or service, new language in some of the agency's contracts calls for "some sort of royalty" to be paid.

 

Rob Siltanen, chairman-chief creative officer, Siltanen & Partners, is well-known as the inventor of Baby Bob, a talking baby with the mouth of a wisecracking old man, for client Freeinternet.com. When the dot-com went out of business, Mr. Siltanen exchanged rights to the character for the money owed the agency. He then took Baby Bob to CBS, which used the character for a short time; later, Quizno's used Baby Bob to hawk its sandwiches. Mr. Siltanen won't reveal how much he's made by hanging onto character rights but said, "It's been very lucrative."

 

Content creation

Agencies' moves into content creation -- such as Bartle Bogle Hegarty, New York's co-production last year of an MTV special that's set to become a TV show -- is another factor for rethinking traditional labor-based compensation models. Agencies might share syndication revenue or retain rights to creative content. When Crispin created a video game for Burger King, it was paid a fee in addition to what it is paid to create advertising, one executive said, although the agency does not receive a percentage of sales. A Crispin spokeswoman declined to comment.

 

Even agencies that remain focused on old-media advertising are benefiting from the move away from cost-plus or labor-based agreements.

 

Brad Brinegar, chairman-CEO of McKinney, Raleigh, N.C., is a big believer that agencies should be paid for the value they create and has been developing new compensation forms for several years. With one client, in addition to a base fee, McKinney took 50,000 stock options in the company.

 

"They were growing sales and profits regularly; our assumption is that we could increase their price-to-earnings ratio," he said. With another, McKinney aligned its financial objectives with those of the client's chief marketing officer so the agency's bonus was "based on the same criteria as his," Mr. Brinegar said.

 

Long-running ads

Consider the value to a client of a campaign that's run over a decade, such as MasterCard's "Priceless," created by McCann. "We're pushing more and more" for contract provisions that entitle agencies to additional payment if creative is used beyond a certain amount of time, said Rick Kurnit, attorney, Frankfurt Kurnit Klein & Selz.

 

Another area under discussion: If an account leaves an agency but the campaign created by the shop continues, should the agency continue to be paid? "Perhaps the work can be used in one geographic territory, such as the U.S., but if it goes global, a new agreement is necessary," said Mr. Urbach, who advocates approaching client-agency compensation agreements like prenuptial agreements: "Instead of deciding it later, decide it now."

 

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TBWA Drops Out of Sprint Creative Review / Agency Was Telecom's Incumbent for Consumer Advertising

By Brooke Capps and Alice Z. Cuneo / Published: January 22, 2007

 

NEW YORK (AdAge.com) -- Omnicom Group's TBWA/Chiat/Day, New York, said it has dropped out of the Sprint creative advertising account review.

Sprint's other incumbent, Publicis & Hal Riney, is still in the review.

 

Publicis & Hal Riney, San Francisco, Sprint's longtime agency for general advertising and the incumbent on the marketer's business-to-business account, has said it will participate in the pitch. TBWA handled Sprint's consumer advertising.

 

Sprint executives did not return calls and e-mails seeking comment by deadline.

 

'Strategic decision'

In a statement released today, TBWA said, "This was a strategic decision made with a clear understanding of Sprint's challenged business situation, and how we can best help them going forward. We remain very committed to Sprint as a partner for the remaining aspects of service including retail and the marketing services assignments we have through Tequila."

 

The No. 3 telecom company, which spends $1.6 billion in marketing, cited a need for "fresh thinking" when it called the account into review earlier this month.

 

Meetings with yet undetermined agencies are taking place this week.

 

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BELLWETHER SET FAIR FOR 2007 UK ADVERTISING GROWTH

 

The Q4 2006 Bellwether Report, the quarterly survey of marketing spend, published by the UK's Institute of Practitioners in Advertising and researched by NTC Economics, reveals a stabilisation of marketing budgets.

 

Contrasting with the sharp downgrades seen earlier in the year this reflects improving business conditions. In fact, budget setting across the whole marketing spectrum will be the most buoyant in seven years for 2007-08.

 

Total marketing budgets were revised down in Q4, but only very marginally. However, the internet saw by far the strongest upward revision, with the sharpest gain since the first quarter of 2000. Although traditional media still holds the lion's share of marketing spend, the internet is now estimated to account for 5% of all marketing budgets.

 

Highlights of the Q4 2006 report include:

Despite the improved performance in the second half of the year, 2006 is likely to have seen the weakest growth in marketing communications since 2002.

In Q4, 17% of companies reported increased total marketing budgets while 18% reported a decrease, so only a marginal net decline.

 

Although traditional advertising continued to lose share of total marketing spend the overall reduction was slight. 18% of companies reported a downward revision but 15% reported an increase.

 

Internet marketing budgets out performed all other sectors in Q4, with a net balance of 31.5% of companies reporting an increase across all business sectors.

 

Direct marketing was the only main category of marketing (i.e. excluding the internet) to see a rise in budgets in Q4, with a net balance of 4.1% of companies reporting an increase. Upward budget revisions were linked to new campaigns to meet business expansion as well as a shift in strategy towards direct marketing.

 

By sector, increases to budgets were most widely reported in IT and computing, travel, entertainment, and the financial services. Budget cuts were most widely reported in FMCG, industrial and utilities and the autos sector.

 

Non-traditional marketing, including the internet and sponsorship is so far showing the strongest growth in future spend, followed closely by direct marketing and traditional advertising.

 

Comments IPA president David Pattison: "Business conditions are continuing to improve with 2007 set to be a positive one for all sectors, with indications that there will be strong growth in future spend for both main media and non-traditional marketing."

 

WPP Group ceo Sir Martin Sorrell adds: "The UK, although recently our weakest market internationally, is stabilising and growing again. Q4 was stronger and budgets for 2007 are promising. Again direct, interactive and internet are the star functional sectors."

 

Aegis Group ceo Robert Lerwill says: "Digital excitement shows no sign of abating, with ever more clients catching on. The growth continues to come on all fronts: from those who went digital early and like the results, as well as from the later developers, who don't want to miss out a minute longer."

 

For full details of the report go to www.ipa.co.uk

 

Data sourced from IPA; additional conent by WARC staff, 16 January 2007

 

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The 12 Tenets of Social Media Marketing (and Why You Need to Learn Them)

by B.L. Ochman  / January 23, 2007

 

Marketing is a hard job. It fails almost as often as actors looking for their big break.

 

The delicate relationship between management and marketing is a dance roughly akin to that between fox and hen, but with far less goodwill. To management, you're only as good as your last campaign.

 

So let's look at "The 12 Tenets of Social Media Marketing" to see how you can up your success rate.

 

I. The public is the Lord thy God

Ultimately, you can succeed only if your communications produce results, which shall be known as return on investment, by reaching the greater public. This can be achieved only if your product doesn't suck and your communications are not only clear but also interesting.

 

Verily, if you can become a useful source of information, your message may be heeded, or at least looked at ever so briefly.

 

II. Thou shalt covet all media

Today media is a collective term for the producers of content for mass and, yea, also for niche consumption. Thou must niche or be niched. Thy niches may include surly teenagers in fly-over states, as well as disgruntled consumers. To communicate with them successfully you must approach them from the right perspective.

 

Thou shalt not piss them off by ignoring or patronizing them, for if thou do they shalt bite you on the ass.

If you pitch big-time media, you need to have big-time story ideas. However, despair not because these days everyone with a Web site, newsletter, blog, e-zine, mail list or forum is a journalist.

 

III. Ignore not peer-to-peer media

Become familiar with, and participate in, forums, mail lists, and discussion groups that pertain to your segment. Provide information of value and your reputation will grow. Thou wilt not be sorry that thou hast done this extra work.

 

Electronic media, of all kinds, is virgin territory for the intrepid marketer. Useth video, podcasts, and blog advertising to communicate.

 

IV. Thou shalt think globally and speak in tongues

Many perceive that a global marketing strategy is only suitable for giants such as Proctor & Gamble and Microsoft, which have big budgets to spend and big brands to promote. But the advent of the Internet is the final stage in a process of globalization that gives firms of all sizes the opportunity to sell their products and services to the many countries of the world.

 

Only market to countries where thy sales items—product, idea or event—affect their country and will be of particular interest to their readers. Bother to hire a qualified translator rather than relying on machine translations that can make you looketh like the village idiot.

 

Be careful to make your communication with simple words, avoiding idioms and complex sentence structures.

 

V. Thy communications must pass the "who cares?" test

Abandon ye all communications that are long-winded, formulaic, boring as hell, and laden with superlatives and marketing babble.

 

Write down your concept in one sentence. Then ask yourself, and answer honestly, "So what?" If it still sounds like a good idea, proceed to rewrite it, over and over, until it has not one extra word.

 

VI. Thou shalt learn to create artful blog and forum comments

Yes, yes, yes, despite SEC requirements, bosses, shareholders and lawyers, thou shalt participate in the social media sphere. Write thy comments in a human, and not a godly voice.

 

Maketh thy comments in one-paragraph, in language appropriate to the publication, and explaineth what thou art saying clearly.

 

Dispense with excessive exaggeration. Provideth contact details in your signature.

 

VII. Thou shalt not talk shit

No one in any social medium will tolerate bluff or bluster. They dislike anyone who takes forever to make a point. They particularly don't like flacks or interviewees who try to make simple concepts unnecessarily complex by burdening them with excessive technical jargon or MBA-speak.

 

Clearly and transparently communicate facts and insight pertaining to your company, its strategy, and its products… and therefore appeareth intelligent.

 

VIII. Thou shalt not make someone else speak for thee

Write thy own comments, blog posts, articles, and emails. Flog not. Do not think that nobody will know. Never, never let a lawyer write anything, for all they talk is useless double-speak.

 

IX. Thou shalt not refuse to comment when thy company is under fire

Diggeth a hole and place within it thy head only if thou carest not that thy brand image will turn to doo-doo. "No comment" is a fine phrase for royalty, criminals, and celebrities, but not so great for corporations that have a responsibility to shareholders, clients, and consumers.

 

Unfortunately, in difficult situations it may be impossible for representatives to tell the media the whole truth. Try to be honest about which subjects thou wilt be able to talk frankly about, and which you may find difficult to comment upon.

 

In accordance with the sixth tenet, it's better to give a concise response that is straight to the point than one that is evasive, lengthy, and obviously spun.

 

X. Concern thyself with thy overall marketing strategy

Thy overall marketing strategy is an arduous process that requires constant vigilance. To be successful thou must practice true multi-channel marketing in which you synergize your advertising, PR, Internet and sponsorship efforts to project a unified image and allow personality to shine through the corporate shield.

 

XI. Give they brand to the consumer

They will take very good care of it, for they will give it back to you in better shape than when they got it. Fear not that thy consumer shall have input in your brand. But heed closely thy clueless ad agency so it does not chargeth thee a hefty fee when in fact the consumer creates thy ads.

 

XII. Remember: thou must keep holy the Internet.

The Internet has changed the nature of marketing irrevocably in two distinct regards. It has changed the way companies communicate with the public and the media. Thy public often is thy media as well. Screw them not.

 

B.L. Ochman is a social media marketing strategist for S&P 500 companies, including McGraw Hill, IBM, Cendant, and American Greetings. She publishes What's Next Blog and Ethics Crisis, where readers can confess their worst ethics transgressions and others can rate them on a scale of one to ten. She also blogs for MarketingProfs Daily Fix Blog.

 

Marketing on MySpace / by Stephan Spencer  / January 2, 2007

 

With tens of millions of users (but probably not the purported 100 million), MySpace.com is a force to be reckoned with. Especially when you consider that MySpace apparently drives more traffic to online retailers than MSN Search, according to some recent Hitwise data.

 

But MySpace is hard for many of us adults to get our heads around. It just doesn't seem logical: How does it hold the interest of so many young people with short attention spans, despite the fact that the design/usability is so atrocious, the Web page creation platform is so frustratingly restrictive, and it's chock full of so many profiles that are obviously fake, spam, duplicated, or abandoned?

 

"Um, it's about looking cool, fitting in, and hanging out, Duh!" one might imagine a teen MySpace user answering.

 

Then where do us adults feature in this? Besides offering a tempting place for stalkers and voyeurs to hang out and follow the daily lives of the teenagers who haven't made their profiles private (can you say "Creepy!"?), MySpace is host to concerned parents trying to keep tabs on their kids, college students, obsessed sports fans, and realtors. In other words, the Average Joe or Jane. MySpace is a real slice of humanity.

 

Of course within the MySpace ecosystem exist marketers. But most are clueless. One would expect sophisticated MySpace presences from big brand marketers. However, that is usually not the case. And generally those that are present, like Blockbuster UK, 7Eleven, and Meijer, lack key ingredients for MySpace success—like an impressive number of "Friends."

 

What is probably horrifying to these brand marketers is that employees and customers think nothing of developing a MySpace presence on behalf of the company—one that may not be very flattering. Consider, for example, these unofficial MySpace pages for Wal-Mart, K-Mart, and Target. Undoubtedly, this leads to customer confusion, because it can be difficult to ascertain the author of a MySpace profile. And such unauthorized pages can tarnish the company's reputation, depending on their content.

 

Before you leap in to MySpace as a marketer, you'd best understand it. Because if you don't, the MySpace community can turn on you the moment you make your first misstep. Just like bloggers can. (Note: many MySpace users are bloggers too. MySpace supports blogging within its platform.) The cardinal rule in MySpace is the same one as in the blogosphere: Keep it real.

 

Still, despite the hazards, MySpace offers a lot promise as a venue for marketers to hawk their wares. MySpace allows you to interject yourself into existing networks of trust-based relationships and to bond with your visitors in ways not possible elsewhere on the Web. And you can interact with huge numbers of adults, not just teenagers. Surprisingly, more than half of MySpace visitors are age 35 or older, and more than two-thirds are age 25 or older, according to comScore Media Metrix.

 

Do you have what it takes to crack MySpace? The most unlikely of marketers seem to have it—bars, bands, and quirky dot-coms. One of my favorite examples of MySpace marketing is Project Red. Not only is Project Red a world-changing organization on a mission to defeat AIDS in Africa, its MySpace profile is attractive and engaging.

 

Other noteworthy examples come from Apple Computer, the Brooklyn Museum, Drumz Clothing, the Orlando Magic, the movie studio that produced Superman Returns, the comedy character Borat, and the musical artist "Weird Al" Yankovic.

 

A couple of these I've been tracking for several months, watching the size of their networks expand. First, consider Apple Computer. Its various flavors of iPod Nano have a place on MySpace, e.g. Pink Nano, which is enjoying a meteoric rise in Friend status. I started tracking Pink Nano on October 15, when it had 1,500 MySpace friends. A week later, on October 22, it had climbed to 7,449 friends. On October 27, it was up to 37,070 friends. Now, on December 3, as I write this article, it has reached 55,776. Not a bad marketing job, Apple!

 

Now consider the "comeback king" of musical parody—"Weird Al" Yankovic. He's using social media quite successfully to help breathe new life into his 27-year-long music career—thanks, in no small part, to YouTube and MySpace. Yankovic told Reuters/Billboard in a recent interview that he had accumulated 155,000 MySpace friends since he joined the site in July—all of which he had personally added. He stated, "I used to be a little pickier. Now I just kind of click as fast as I can." (I can only imagine the Repetitive Stress Injury from that much clicking!) Here's the kicker: a week after this article came out, he was already up to 219,033 friends! Another seven days later, and Weird Al had gained another 24,000 MySpace friends (up to 243,221). Now, on December 3, it's at 325,614!

 

One small company that has enjoyed a degree of success in terms of traffic and sales through MySpace is the online jewelry retailer Pugster. Its mascot, a pug dog named Pinky, is the subject of the MySpace profile—a clever move, as it puts a disarming "face" to the company. The firm built up its MySpace page to a very respectable 8,053 friends. In a recent interview with me, Michael Boldin from its online marketing team revealed some secrets of their success:

 

It's easy to get overwhelmed with the sheer numbers on MySpace—and important to try to focus on marketing to the "right" group for your product or service — otherwise you'll be spending a LOT of time on people who will never be interested in you.

 

But, on the other hand, when starting off, you need to get Friends. It's kind of a bragging right on MySpace. If you have too few friends, it'll be tough to get the good ones—the ones who will end up buying from you. So, before you go after those, get a few hundred "bad" friends—bands are the easiest. They'll give you a respectable number on your Friends list, and will leave comments on your page—giving a little realism boost to your profile—making the addition of friends of the "good" type that much easier.

 

Where else could we find a place to actually build relationships with people—who may or may not have heard of us before. We spend time daily emailing people, and guess what, they email back. It becomes the ultimate soft-sell tool.

 

Have patience. Without a huge brand presence, don't expect to turn profits. The only investment is your time. As long as you regularly give people something interesting—blogs, music, and other tidbits that AREN'T related to your business—then you'll develop enough trust for them to be interested in what you DO sell.

 

Keep it personal—talk with the people as if you'd email a new friend. Say "Hi," get to know them, and they'll want to get to know you. If you try to sell, sell, sell, you'll have a hard time earning respect on MySpace.

 

As far as layouts, there are a few "schools of thought"—one says make it fancy and high end, but the other, and seemingly more successful one, says simplicity is best. Since people are browsing through so many profiles with the same layout, they look for certain features in certain places. If you move too many things around, you'll frustrate your visitors and they'll leave. Make it intuitive and easy, just like a good e-commerce site.

 

If there's anything a "seasoned" MySpace user hates it is a slow page. The MySpace site has loads of slow loaders. You may get friends with a lot of stuff on your page, but they won't actually spend the time to interact with you.

You know who else gets MySpace? Site owners like this one who provide layouts, backgrounds, funny photos etc. to the MySpace community. Those folks are sitting back, sipping pina coladas and watching the moolah from Google AdSense roll in.

 

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Marketing to Generation X and Y

by Michael Fleischner / January 23, 2007

 

If you're trying to market to adults who were born between 1965 and 1994, then you need to understand the best method for reaching generation X and generation Y.

 

Who is a part of Generation X? Gen Xers were born between 1965 and 1976 and make up about 17% of the U.S. population. As a whole, this group is both independent and skeptical, existing in the shadow of Baby Boomers. As they move into their 30s and 40s, Gen Xers are establishing themselves as consumers who are starting families and buying homes.

 

Who is a part of Generation Y? Individuals born between 1977 and 1994 are considered Gen Yers and make up about 25% of the U.S. population. This group is generally idealistic, optimistic, and patriotic. Gen Yers consume media in extremely fragmented ways, representing the next big wave in our demographic makeup.

 

Gen Xers and Gen Yers have a number of things in common. Both groups grew up with recessions, single-parent households, cable TV, the Internet and other personal technology. Consequently, these groups consume media differently from earlier generations. Communicating with them through traditional marketing channels can be difficult. So, how can you reach these groups, communicate your message, and get them to take action?

 

The answer is more traditional than you think. In combination with online marketing, direct mail is one of the most powerful ways to market to both Gen X and Y.

 

According to a recent study conducted by InnoMedia, NuStats, and Vertis, 87% of Gen Y and 86% of Gen X bring in the mail the day it's delivered; and 73% of Gen Y and 68% of Gen X retail direct-mail readers have used coupons received in the mail; Gen X and Y consumers rate 75% of the mail they receive as valuable.

 

To reach Gen X and Y with direct mail, you should keep in mind some basic marketing practices. Keep in mind that your direct mail efforts can be supplemented with online marketing in the form of targeted site advertising and keyword buys, or perhaps you can give these consumers a reason to visit you online via email (contests, sweepstakes, discounts, etc.).

 

Direct mail is most effective when you understand your audience, time your campaign appropriately, provide a compelling offer, and develop a relevant message:

 

Audience. Knowing your audience is essential for the success of any direct marketing campaign. Having information about Gen Xers or Yers in general terms is a place start, but you need to dig deeper and develop a fuller understanding of the segment. You should know their motivations, there greatest pains, their latent needs—and what products or solutions they use. Once you've gotten to know your audience, other marketing criteria can fall into place.

 

Timing. Communicating your message at the right time can make all the difference in your marketing results. Selling tax software immediately after April 15th won't produce the results you're looking for. You need to have an understanding of your audience's timeline and when they are in the market to buy your product or service. Be sure to give them enough time to respond to your offer, but don't leave it open ended.

 

Offer. Many consumers need a reason to buy, especially Gen Xers, who are normally skeptical. Your offer should provide some benefit to the buyer as well as provide some level of comfort in moving forward with a purchase. This can be in the form of a satisfaction guarantee or something similar. One great technique is to place your offer on the outside of the envelope that contains your marketing materials. This can help to differentiate your mail and get your envelope opened by prospects.

 

Message. Your message needs to resonate with prospective buyers. Do you understand their needs? Have you communicated benefits as well as features? Are you solving a problem for them? Have you provided a simple, yet compelling message? Many direct marketers talk about the "long" letter versus the "short" letter. Studies validate the use of both. As long as your message resonates with buyers, it doesn't matter how long it is. But be sure to test your messages on an ongoing basis.

If you're marketing to either Generation X or Y, or both, use direct mail in your marketing mix. Individuals in these groups respond to direct mail. Keep in mind, however, that a direct marketing piece should be supplemented with other forms of marketing—Internet marketing, search engine optimization, advertising, etc.

 

Direct mail is your key to success with Generations X and Y when used as the main vehicle of your marketing campaign.

 

Michael Fleischner is VP of marketing for an education planning and finance company in central New Jersey and the founder of MarketingScoop.com (www.marketingscoop.com). He has more than 12 years of marketing experience and blogs at marketing-expert.blogspot.com.

 

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Satisfying the 10 Cravings of a New Generation of Consumers (Part 2 of 2)

by Lisa Johnson and Cheri Hanson / September 19, 2006

 

In Part 1 we discussed how some of the most recent cultural touch points—groups riding the underground buzz on YouTube; MySpace selling music from indie bands; and the "skinny jeans" fashion trend—show a new market code at work. The young, tech-savvy members of the Connected Generation are rewriting the rules and changing how everyone will do business.

 

In our new book, Mind Your X's and Y's, we outline 10 cravings that are driving this renegade new generation of consumers. Part one explored the first five cravings: for extreme personalization, adventure, loose social networks, brilliant design, and smart editors. Before we move on to the last five, there are two critical principles to understand about the Connected Generation.

 

Reconstructing the Market

When a band goes from dancing on treadmills in a low-budget video clip to performing for the MTV Video Music Awards in a matter of weeks, you know there's a change in the air. Clearly, underground trends and finds have always filtered their way from the fringes into the mainstream—especially if you're talking fashion or music. What's different today is that the Connected Generation is completely sidestepping the mainstream. Thanks to tightly knit peer networks and online technology, indie bands, for example, don't need to sign record deals. They can build a fan base on MySpace, pack their local shows, and post pay-per-download digital files. No middleman, no loss of control.

 

The new marketplace favors connected brands with three essential components—community, content, and commerce. Think about MySpace again. This popular networking portal has content (teens and young adults posting their profiles, uploading photos, writing blogs, and sharing messages), community (a dedicated group of users who visit multiple times each day and conduct vast portions of their lives online), and now, with its music sales, commerce. The brand is unstoppable.

 

Breakaway Brands

To crack this new market code and understand the 10 cravings, we studied hundreds of brands that are experiencing runaway success. From Toyota's Scion to Jones Soda to Wikipedia and beyond, these are the products, services, and organizations that are attracting an unprecedented degree of buzz and customer loyalty.

 

We found that the most successful brands not only complete the three-part business model—community, content, and commerce—but also have implemented a "pull" philosophy in their sales and marketing efforts.

 

The "go big, go loud, go often" approach just doesn't cut it with the Connected Generation, which is all but immune to traditional advertising. If the technology to block out unwanted marketing messages does not already exist (such as TiVo and podcasts), they will create it. But, they will pull in anything that is fun or interesting and adds value to their busy lives.

 

The Connected Generation desires peer-like relationships with the brands they love. Treat them with respect, satisfy their cravings, and they will respond with unmatched enthusiasm and spread the word faster and farther than ever before.

 

Here are the last five cravings that drive this powerful new consumer group:

 

6. Keep it underground: The rejection of push advertising and the rising influence of peer-to-peer networks

The Connected Generation has grown up feeling saturated with advertising and marketing. They are suspicious of ordinary "push" campaigns and gravitate toward integrated, contextual offerings from trusted friends and members of their networks.

 

A select group of people discovers something new, from shoes to bands to politics to neighborhoods, and translates it to satisfy a much wider audience. This is the way of the underground.

 

7. Build it together: Connected citizens explore their creative power and influence change

There are currently one billion people connected online around the world. With so many people conducting large portions of their lives online, we've only just begun to tap into the power of Web-based networks.

 

The Connected Generation is becoming intoxicated by its growing ability to spark change—both as consumer groups and as end users. This awareness is spurring mass creativity and launching a power shift away from companies and into the hands of consumers.

 

8. Bring it to life: Everyday activities are orchestrated to deliver a dramatic sense of theater

From beverages to designer fashions to dinnertime solutions, brand theater is popping up in virtually every industry as savvy companies deliver compelling and entertaining new experiences.

 

Brand theater allows companies of all kinds to create emotional connections with their customers. It takes typical experiences a few steps forward by engaging the senses, the imagination, and the spirit, and transforms routine experiences into riveting entertainment.

 

9. Go inward: Spiritual hunger and modern media find common ground

Increasingly, the meaningful life is defined as the spiritual life, and spirituality has become a dominant value among today's consumers. Companies and media channels are introducing new products, services, and forums to support this spiritually hungry generation. The Connected Generation has embraced modern media and blurred the lines between secular and sacred, finding spirituality in all aspects of their lives.

 

10. Give back: Redefining volunteerism and the meaning of contribution

There's a new spirit of volunteerism in the air, led by a young Connected Generation that has new ideas about how to give back. Today's volunteers want to give their time and talent instead of simply writing a check. Modern volunteer associations combine fresh structures with fun people and a chance to make direct, meaningful connections with the community. These new giving models are igniting a generation and making their volunteer efforts convenient, high impact, and more emotionally satisfying.

 

Lisa Johnson and Cheri Hanson are cofounders of the Reach Group (www.reachgroupconsulting.com), a boutique consultancy that provides fresh insights and clear thinking about the Connected Generation. With three divisions—ReachWomen, Reach X and Y, and Content Strategy—the Reach Group provide tools for engaging the modern marketplace.

 

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Wendy's Taps Publicis Shops for $300 Million Account / Saatchi Takes Creative, MediaVest Gets Buying and Planning Duties

By Brooke Capps and Lisa Sanders / Published: January 24, 2007

 

NEW YORK (AdAge.com) -- Wendy's is moving its $300 million creative account from Interpublic Group of Cos.' McCann Erickson to Publicis Groupe's Saatchi & Saatchi, and Saatchi sibling MediaVest will handle media buying and planning responsibilities, the marketer said today.

The fate of the Wendy's account has been hotly speculated for more than a year.

 

The media incumbent was Interpublic's Universal McCann. Wendy's also said MDC Corp.'s Kirshenbaum Bond & Partners will work on designated creative projects.

 

Year of speculation

The fate of the account has been hotly speculated about for more than a year. A number of agencies have met with Ian Rowden, senior VP-chief marketing officer, according to these executives. A Wendy's spokesman couldn't be reached, but Mr. Rowden, contacted by cellphone, refused to comment, saying he was in a meeting.

 

The agencies referred calls to the marketer and a Wendy's spokesman declined comment.

 

According to one executive familiar with situation, Mr. Rowden declined the traditional pitch process in favor of a series of meetings with agencies, in which each agency presented past work and talked a little about ideas for the client. "They picked an agency and not a campaign and that is how you should find an agency," said the executive.

 

Wendy's spent $387 million in measured media in 2005 and $290 million from January through September 2006, according to TNS Media Intelligence. With only national and some cable responsibilities, McCann Erickson and Universal McCann handled about half of that media outlay.

 

Good end after bad start

Wendy's rival and market leader McDonald's today reported record earnings for 2006. Wendy's, the No. 3 fast-food chain (behind Burger King), on Jan. 5 posted improved same-store sales during the fourth quarter of 2006, though last year started out disastrously, with negative same-store sales in the first half. Those results had compounded an already bad situation, as 2005 ended with losses. That poor performance prompted a franchisee revolt, and activist investor Nelson Peltz won seats for himself and two disciples on the company's board. Last April, Chairman-CEO Jack Schuessler was ousted.

 

Kerri Anderson, named CEO-president in November after serving as interim chief for several months, reshuffled management and marketing, trimmed employees and shed assets to cut $100 million in costs.

 

While Wendy's same-store sales have turned positive, executives close to the matter said franchisees remained unhappy with sales, given its long drought and the improved sales at rival burger chains. "How long can you be down," asked one industry observer.

 

Vidal Partnership, an independent agency based in New York, retains duties for Hispanic marketing.

 

Kate MacArthur and Matthew Creamer contributed to this report.

 

Google Video, YouTube to Remain Separate Operations / Search Giant to Have Its Properties 'Play to Their Respective Strengths'

By Abbey Klaassen  / Published: January 25, 2007

 

NEW YORK (AdAge.com) -- Google unveiled the first integration between Google Video and YouTube today, when it announced it was adding YouTube video results to its Google Video search index.

 

The company issued a statement to update the status of Google Video and YouTube and said the two services would remain largely independent and "play to their respective strengths." For YouTube, that is remaining the destination for uploading, viewing and sharing videos; for Google Video, that remains search and creating new video technologies.

 

Video search destination

So it would appear Google Video is viewed less as an online video viewing destination and more primarily as a video search destination.

 

Google purchased YouTube for $1.65 billion in early October. The deal closed mid-November but the companies have, until now, stayed relatively mum on whether they would remain entirely independent or work together. Some have even suggested Google should merge Google Video into the more popular and widely known YouTube. It appears the answer to that question lies somewhere in the middle of range of speculation.

 

Google will offer YouTube access to search and monetization platforms -- although the statement didn't indicate what exactly that monetization would look like. Currently, YouTube has sold branded channels and worked with advertisers to sponsor user-generated content contests. It has also worked with TV networks and movie studios to help promote programs and films and offers advertisers the opportunity to buy plum front-page placement. It recently signed a deal with Verizon that offers a subscription mobile service.

 

"Ultimately, we envision most user-generated and premium video content being hosted on YouTube so that it can further enhance the YouTube experience," the statement read. "We also envision YouTube benefiting from future Google Video innovations -- especially those involving video search, monetization and distribution."

 

For Super Bowl Buy, Think Local / With Six Days to Go, Spots Still Available at Affiliates

By Claire Atkinson  / Published: January 25, 2007

 

NEW YORK (AdAge.com) -- With six business days to go until Super Bowl Sunday, the CBS TV Stations group has two to three spots left in each of its local markets for advertisers seeking to take advantage of cheaper local ad buys than coughing up $2.6 million for a national buy.

To get around Anheuser-Busch's beer stranglehold on the Super Bowl in 2005, Heineken found airtime for its ad with Brad Pitt on local affilaites.

 

According to executives on both the sales and buying side of the big game, the priciest 30-second spots are selling for around $300,000, and, not surprisingly, the most expensive local market is Chicago, as the hometown Bears are squaring off against the Indianapolis Colts. Audience levels are expected to be highest those two markets.

 

Good matchup for CBS

The matchup is good news for CBS, which owns its affiliate station in the Chicago market. Julio Marenghi, president-ad sales at the CBS TV Station group, said most new money had come from advertisers that had negotiated a contingency clause that stipulated they would buy time in the game if certain teams reached the final. Otherwise, he said he hasn't experienced a surge of last-minute buys and that he expects local sales will be wrapped up next week.

 

Marketers who can't buy into the big game because of category exclusivity clauses can get around that restriction by doing a local buy. In 2005, Heineken got around Anheuser-Busch's dominance of the beer category on the national level with a huge local spot buy for its ad featuring actor Brad Pitt on local Fox stations. Fox aired the Super Bowl last year.

 

"There are people who wait to see who the teams are to see if [the game is] going to be exciting," said Kathy Crawford, president-local broadcast at MindShare Worldwide.

 

Tough to get around exclusivity

But it might be tougher this year to orchestrate a local buy to get around exclusivity, because CBS owns many of its affiliates in major markets, Ms. Crawford said, and it will likely restrict those stations from selling ads to competitors of marketers that have already bought airtime on a national level.

 

CBS owns stations in Austin, Baltimore, Boston, Chicago, Dallas, Denver, Detroit, Green Bay, Los Angeles, Miami, Minneapolis, New York, Philadelphia, Pittsburgh, Sacramento, Salt Lake City and San Francisco.

 

While a local buy might seem like good value, Ms. Crawford said its important to realize that marketers aren't simply buying an in-game spot from the local affiliate, because affiliates often only allow buys in a package of spots that include pre-game, post-game and possibly other nights in prime-time that week. Marketers need to be prepared to factor that into their buys, she said.

 

Now that the matchup is decided, a number of marketers have chosen to publicize their participation in the game, including Walt Disney Co., InfoUSA's SalesGenie.com, Sprint and Coca-Cola Co. On a national level, CBS said it is 85% sold and is tying up a variety of negotiations.

 

Marketers gauge interest

JoAnn Ross, CBS president-ad sales, said yesterday at a Super Bowl panel, "Like any other event, like the Academy Awards, people want to wait to the last minute to see if they are going to get a discount. What has happened this year is that after our championship game on Sunday, which had one of the biggest ratings in years, there has been a lot of fresh interest."

 

The National Football Conference game on Fox between the Chicago Bears and the New Orleans Saints drew 43.2 million views and a 25.1 rating. The big numbers point to a huge interest in the Feb. 4 Super Bowl. Meanwhile, 46.7 million viewers tuned into CBS to watch Colts make it past their American Football Conference nemesis New England Patriots, the most-watched AFC championship since 1986.

 

"It might be a very intelligent thing for CBS to tell people how well the games did last Sunday," said Aaron Cohen, senior VP-director of national broadcast at Horizon Media.

 

CBS also has plans to involve its star news anchor Katie Couric in its Super Bowl coverage. Ms. Couric, who hosts the "CBS Evening News," will be featured in the pre-game package of events.

 

Mainstream marketers finally embrace the Web: What Took So Long?

by Kirk Drummond, January 2007 issue

 

A spate of articles highlighting various industries' entry into online branding begs the question, "What took so long?" The Internet has been a legitimate advertising vehicle for more than 10 years. Why are mainstream marketers just now embracing its huge potential as a branding medium?

 

Arguably, there have been barriers. Poky Web connections were an issue up until a few years ago. But today nearly 80 percent of U.S. Web users connecting to the Internet from home do so via broadband, according to Nielsen NetRatings.

 

To a certain degree, lack of vision accounts for the delayed reaction. Many marketers initially viewed the Web as nothing more than "brochureware" or limited to below-the-line transactional support, not as a platform for engagement or a vehicle for delivering rich, brand-building experiences. In many cases, where senior management overlooked the opportunities, grassroots efforts in the organization served as the catalyst. There was a gap between those who foresaw the Internet's potential and key strategists and decision makers.

 

Finally, agency partners were also slow to adapt. Traditional agencies, like their clients, focused on the Web as a transactional medium and didn't initially recognize its promise. Only now, as more of their branding budgets shift from TV to online, are these agencies considering online as a core strategic component.

 

>>What did early adopters know that others missed? While some companies hesitated on the road to online branding, others overcame the hurdles and evolved their offerings for the Internet. Nike's first online offering wasn't as compelling as today's, but it was there, and it was good (if not great) based on what was possible at the time. What did Nike have that others lacked? Turns out that it's more about what the brand didn't have - fear. Nike's risk-taking shows in its current foray with Apple's iPod.

 

>>Unprecedented opportunity. What visionary companies including Nike, AT&T, and IBM understood early on is that the Web's interactive nature makes it an incredibly fertile environment for developing a brand. Done right, you can achieve a stronger emotional response, develop a longer relationship, give people a chance to delve as deeply as they desire, and it's all just one click away from a transactional opportunity.

 

Marketers are now discovering that online experiences can actually be the hub of branding strategies, not just a single spoke. While high-end brands may have been the first to capitalize on the Web's potential, companies of any size can, and should, add the Web to their strategic mix.

 

>>Interactive edge. The Web's interactive capabilities make it a compelling branding tool. Because it's a two-way medium, it allows for rich content delivery and significant user engagement. It offers connections to valuable and informative experiences based on the viewer's unique needs. Some 80 percent of marketers surveyed by Forrester and the Association of National Advertisers said they planned to reduce TV ad spending by at least 25 percent and reallocate funds to Web advertising.

 

>>Where do you go from here? If you haven't made the shift to online, start exploring your brand's opportunities immediately. Find champions within your organization and generate momentum to integrate online branding into your marketing mix. Know that senior executives may not buy the concept immediately - branding online is complex, not without risk, and therefore a little scary. Offset any fear with a well-designed strategy. A good way to start is by partnering with a "solution-agnostic" agency - one that understands the intricacies of the online space, how to create strong brand-building experiences, and can maximize the effectiveness of each marketing vehicle. It takes more than a clever concept to compete.

 

Kirk Drummond is the vice president of creative and innovation for T3. (kirk.drummond@t-3.com)

 

"The Week" Willing to Prove Its Worth/ Offers Ad Effectiveness Research to Almost All Its Advertisers

By Nat Ives / Published: January 26, 2007

 

NEW YORK (AdAge.com) -- Ever since the internet came along, advertisers have gotten used to seeing how many people are clicking on their ads in near real-time. Despite the pressure that put on old-line media to improve its slower and less exact proofs of return on investment, offering outside research to advertisers for every buy is far from the norm. Now The Week magazine is trying to take advantage of that tension by promising third-party ad-effectiveness research to any advertiser who buys at least three ad pages and customized research for anyone running at least six pages. 

 

Crucial clients

Plenty of other titles provide varying degrees of research, but most often it is done for crucial clients or those with large integrated buys, said Eric Blankfein, senior VP-channel insights director, Horizon Media. "Even if you're a big advertiser, in a lot of cases research still isn't part and parcel," he said. "You certainly expect verification for a schedule. Ad recall is not something you would always expect."

 

Justin Smith, president of The Week, said offering research to just about everyone is a something his advertisers should love. "Marketers love putting money into the channels that work and less into the channels," he said. "We're not only tracking our engagement, reader demographics and psychographics but ad effectiveness. It's a bit of throwing down the gauntlet."

 

"A lot of big advertises have twisted the arms of media owners and said 'Do this for me if I throw down this money,' but I don't think anyone's baked it into the heart of the business model, which is our intention," he said.

 

Dangling a carrot

Mr. Blankfein called the offer appealing. "It's a least a carrot to get some advertising to come in."

 

The Week, which Dennis Publishing introduced to the U.S. in 2001, enjoyed meteoric growth in ad page sales in its early years but has lost some momentum as it matured. Ad pages were essentially flat last year, up 0.7% over 2005 with a total of 572.3, according to the Publishers Information Bureau. Pages rose 8.6% in 2005 after jumping 25.5% in 2004.

 

The Week reported an average paid and verified circulation of 439,401 in the first half of 2006, the most recent figure available, according to the Audit Bureau of Circulations.

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Compiled By Daniel Sage / President of MobileAdMarketing.com (300,000 Mobile Ad Spaces Available in 300 Markets in 48 States)

 

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