Good Morning Advertising Industry. This is Your 7am Wake-up Call.

I’m in the midst of reading former BBDO Chairman Phil Dusenberry’s entertaining new book entitled, "Then We Set His Hair on Fire." The book chronicles Dusenberry’s various exploits and uber Dusenberry successful campaigns for the likes of Campbell’s Soup, Pepsi-Cola and the 1984 presidential campaign to re-elect Ronald Reagan.

As might be expected, the book has been receiving favorable reviews in the ad trades as well as the Wall Street Journal. While it is a fun read, Dusenberry’s book reflects the still-prevalent mindset among advertising types that their craft is the be-all and end-all when it comes to reaching consumers and "moving the needle" as Phil describes it.

While that may have been the case when Dusenberry was in his heyday, it simply is no longer true. The rise of technology such as Tivo, the internet, video games, and 500-plus cable channels has totally disintermediated advertising’s once unchallenged supremacy.

Consumers are completely overloaded with information and choices. Gone are the days when a 30-second spot would reach a vast majority of a prospective customer audience and induce them to buy a product or service. Instead, we’ve seen the rise of word of mouth marketing, street-level events, and public relations as the best, most effective ways to reach consumers in a one-to-one, personalized way.

And, yet, Stuart Elliot still writes about massive advertising expenditures in his New York Times column. And, we still see mindless and totally indistinguishable car commercials on TV featuring soundtracks from Rock’s dinosaurs (I defy anyone to watch five or six of these commercials in a row and then correctly name each car). As a matter of fact, except for the Geico and Mastercard commercials, I’d be hard-pressed to name any TV spots that actually break through and register in my personally overloaded mind.

So, all I’m asking is that advertisers wake up and start spending their money in smarter, more direct ways. Dusenberry and his ad agency buddies had a great run. But, the times they are a changing.

7 thoughts on “Good Morning Advertising Industry. This is Your 7am Wake-up Call.

  1. Isaac,
    You definitely make some good points, perhaps the best way to characterize my response to most of what you write is; I agree to a degree.
    I don’t want to put words in RepMan’s mouth or scribbles on his page, he’s a far more accomplished writer than I, however I think his point, at least as I understand it, is that a pay-for-play model is fraught with more drawbacks both for the PR firm and the client and therefore the net result is an inferior PR product.
    Yes, the proof is to a large extent in the ink, yes companies can justify communications spending more easily by pointing to x number of positive placements over y time, but here’s the thing; if the business model is a process where revenue is dependant on a volume of product than the producers will logically only focus on that volume and not the quality of the product.
    I believe you hit on it in your reply to my first post where you wrote about a business only paying for a story they were happy with. Two things, first what goes into getting that story you are happy with, which leads us back to all that strategy, and brain work, and second, what about the story you’re not happy with? How damaging is it too your brand, how much work will it take to “un-do” the damage to your company’s reputation? And given the model you suggest, where the spinners are a-spinning or what RepMan might call “media by the pound” and I would agree, where you are blanketing multiple media targets looking for something to stick, it’s much more likely you’ll wind up with a neutral at best, or a negative story. Which leads us back to the, how much did that cost my reputation discussion.
    The biggest problem with a pay-for-play model is in the model itself, it encourages more quantity and less quality, perhaps there is some market for that in the communications industry, but using your examples and having worked for both Dell and GE in my career I can tell you they approach their communications with a lot more thought prior to executing an external outreach than a pay-for-play model would allow.
    The reason is simple, pay-for-play does not pay for thought, it pays for coverage, and if, as in the model you are describing, you only pay for stories you like, I think you’ll find it actually more economical to pay for strategy and brainwork, plan your campaign and execute based on solid business strategy. You still get coverage but minimize the risk of bad coverage, and ensure the message reaching the media is in-line with your business goals.
    In a very verbose way I’m saying that companies are getting the best value for their dollar in the marketing mix from PR firms like RepMan’s through the coverage they receive that is well thought out, strategically placed and in-line with organizational strategies and messages. The pay-for-play model can offer none of these guarantees or risk avoidance assurances, and I think we can agree no matter what your brand is, it is essential that whomever uses that brand be worthy of your trust and able to preserve the integrity you’ve worked so hard to build.

  2. Steve-
    Just read your response and while I would like to hear from Ad Guy as well, have some points of my own to share.
    As I mentioned, I worked in PR for about 7 years, and can tell from your post that you are a veteran of the industry as well. Let me be clear to start- during my 7 years in PR I drank the company brew and subscribed to everything we preached about how we were building brands and reputations through our work, etc. Now that I have had several years to look back on it, I see a very different picture. Yes, I do believe that PR is an important component of the marketing mix, but not nearly as important as I used to think. I do however believe that crisis communications and reputation management is critical and can not be replaced by a “pay for play” firm.
    That said, the other areas of PR that you mention “experience, council, strategy, knowledge, and the practical and tactical skill sets that create the circumstances that will lead to a placement,” can EASILY be replaced by a “PFP” firm. You should know from working in PR that while there is knowledge, expertise, etc, that go into the placement, most of it is just the spinners spinning the client. The bottom line is that the “thinkers” can strategize all they want and brainstorm until the wee hours, but if the people pitching the story don’t get results, then the bottom line is that the strategy and brainstorming were worth no more than the paper that the monthly invoice is sent on. Like the old saying goes, If a tree falls in the forest, and no one is around…
    You said “The placement, from a business production model standpoint, is actually a byproduct of the processs.” I agree, but clients are hiring you for THAT BYPRODUCT. How many times have clients said to you or your team on a weekly call “sounds like you are doing great work, but where are my hits and interviews.” The GE’s and Dell’s of the world aren’t going to spend 30-50k a month to hear about how the team spent month after month “strategizing and brainstorming” b/c at the end of the day, the PR firm is hired to produce results. And those results are the articles in the media.
    Sure, strategy and creativity are essential, but the hits are what keep the checks flowing. And that is exactly why there is merit to pay for play, maybe not for every company, but certainly for a large percentage of them. Your response clearly shows that you drink the brew, but put yourself in the client’s office for a second. You hire a PR firm that is second to none for its “experience, council, strategy, knowledge, and the practical and tactical skill sets,” and you pay them 30k a month for 6 months and have nothing to show for it. How long are you going to keep them on retainer when XYZ firm comes calling and says that you only pay when you get a placement you are happy with? Cmon Steve, let common sense prevail, and try another brew. I look forward to your response!

  3. Ad Guy and Isaac,
    I really tried hard to not comment on the pay-for-play model, I tried and tried, and thought I’d made it through. Then I saw Isaac’s post and I just could not let it alone.
    I think the issue with both Ad Guy and Isaac is perhaps one of defining what the product is a client is actually buying, more on that in a minute.
    First one needs to look at any business system or market as an ecosystem, that is a complex system of interdependent sometimes cooperative and sometimes competitive components or players. Competition is a healthy part of any ecosystem however, and despite how much you may not like it, unsustainable behavior, in this case a business model doomed to failure, will damage the entire system not simply the effected entity.
    RepMan is right, pay-for-play, even though it may sound like the right, hardball type, business model to force on a PR agency it is unsustainable and will serve to drive the best and most reputable of PR agencies and people from the ecosystem entirely, leaving only those players who are willing to sell a product produced by and dependant on knowingly defective means. What sort of PR agencies will this leave in the ecosystem; the bad ones.
    Specifically on the pay-for-play model, I understand why the concept seems to have a certain surface validity, and even carry some of that hardnosed business cache with it. However if we look at it closely and determine what exactly clients purchase with their communications dollars it is not the actual placement, it is the experience, council, strategy, knowledge, and the practical and tactical skill sets that create the circumstances that will lead to a placement. The placement, from a business production model standpoint, is actually a byproduct of the processs.
    As an aside, how would a pay-for-play agency bill for crisis communications, would you as a client, Ad Guy or Isaac enjoy a huge bill based on Wall Street Journal placement that crucified your company? Better yet in a pay-for-play ecosystem what PR firms would be left that would even develop a specialty in crisis communications, what profit for them would be in such a business move.
    Let’s compare a true pay-for-play model in, “all other businesses,” and take advertising as a comparative industry. What if clients only agreed to pay for advertising based on the actual number of products sold? No payment for filming, no payment for creative, no payment for the media buy, only a final payment at some later date based on how many actual units were sold as a direct result of the ad. It just doesn’t make much sense, even in the advertising industry. A system like that would virtually eliminate concept advertising, brand advertising and I for one, would certainly miss the multi-million dollar one-shot Super Bowl ads, how many Cokes do you need to sell to pay for a Super Bowl ad anyway?

  4. I was at the OMMA conference last week – a PR guy in a room full of advertising folks – thinking ‘my God these people really believe the 30 second spot is coming back….’
    And they call us dinosaurs!

  5. Mr Cody-
    Interesting post on the world of advertising; I do agree that the times are a changin for the ad folks. However, regarding your comment on “pay for play,” and as someone who used to call the PR world home, I do think that concept has a lot of merit. Obviously, it is not something that the traditional PR firms want to hear about. As a business owner, if I were looking for a PR firm, why would I want to shell out 20k a month and potentially get my story told in the pennysaver, when if I got a feature story in WSJ or Fortune, then the 20k would be well spent.
    In regards to their business model, how does any company that depends on sales run their P & L? If I sell furniture, and the Jones & Smith families buy their couch in 2 months as opposed to now, does it kill my business. Most businesses in America do not have a guaranteed monthly income, so the new PR firm will have to live and die based on results they acheieve for clients- something that many traditional PR firms are lucky they don’t have to deal with, at least for now. Who knows, maybe this new firm will change the landscape of PR, much as PR in general has changed the general landscape of the bigger marketing mix.

  6. You make some valid points, but missed the gist of my blog. I think advertising is still a valuable component in any marketing program. The disintegration of traditional communications channels, however, has made it less important and impactful (and too many advertising neanderthals refuse to admit that fact because it would mean totally overhauling their business operations to keep pace). Re: our firm, we do in fact have a proprietary measurement tool called Business Outcomes which tracks client ROI down to the penny. Re: pay for play, it’s a totally bogus and illegitimate way to gauge media relations. What’s one line in a WSJ article worth? How about a cover story in Fortune? Do you use advertising dollars? And how do you run a business from a profit-and-loss standpoint if your revenue depends solely upon whether a reporter decides to write about your client this month or next? Your questions are interesting, but indicate a lack of business management knowledge.

  7. It sure seems like the Repguy has it out for the world of advertising. The interesting point you made was that you remember the Geico and MC spots. So maybe, the issue is that ads themselves aren’t that good, and not that advertising as an industry is going the way of dial-up.
    I ask the Rep Guru, has your firm ever done a study on each of your PR campaigns or evaluated the budget of your clients against what they actually receive in return? At least in advertising, the client sees or hears what they pay for and have something tangible, whereas in Public Relations, the client can get a large bill from its agency, and a load of fluff about what they did to “earn” that money.
    I recently read about a PR firm now offering a service where clients only pay for articles that appear in the media. That to me seems like a great idea, and would then make PR much like everything else in the world,getting something in return for your money. But I would bet that many PR firms are afraid of that concept. After all Mr. Rep Guru, can you honestly say that each and every client you have worked with in your career has received full value for each month’s budget?