1970s Positioning and Watchdogs

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Population: 203.3 million (1970), 226.5 million (1980)

Employment: 60.4% employment (1970), 63.8% employment (1980)

Presidents: Richard M. Nixon (1969-1974), Gerald Ford (1974-1977), Jimmy Carter (1977-1981)

Big names in advertising:

Philip Geier, Interpublic Group of Cos.; Ira C. "Ike" Herbert, Coca-Cola USA; Lee Iacocca, Chrysler Corp.

Top agency in 1970: J. Walter Thompson Co. ($764 million)

Top advertiser in 1970: Procter & Gamble Co. ($256 million)

Total U.S. ad spending in 1970: $19.6 billion

Unlike the continued postwar prosperity that characterized the 1950s and 1960s, the 1970s began with a serious recession and "stagflation." Gas shortages hurt the auto industry, while the success of foreign marketers hurt U.S. business in categories such as the Japanese-dominated electronics segment. Meanwhile, the Vietnam War dragged on, and the Watergate scandal resulted in 300 hours of gripping TV coverage on the hearings. The networks claimed to have lost $10 million in ad revenue and airtime. President Nixon resigned. Consumers started to lose faith in both business and government.

Advertising

Advertisers and agencies suffered along with the rest of the economy. After the creative revolution of the 1960s, the pendulum swung back to more serious, hard-sell advertising. Advertisers wanted efficient, effective, empirical campaigns, based on computer-generated research, with an emphasis on "positioning" their brands vis-...-vis their competitors. Seven-Up's "Un-Cola" campaign, which had begun in the late 1960s, doubled 7Up's sales by positioning it as the opposite of Coca-Cola. Tylenol was "for the millions who should not take aspirin" and became the best-selling non-aspirin pain reliever.

The practice of "corrective advertising"-sometimes voluntary but often Federal Trade Commission-imposed-came about during the 1970s. ITT Continental Baking Co. was the first to agree to such a campaign in 1973, when it was ordered to stop running its advertising; Listerine was one of the most high-profile examples when the FTC ordered it to spend $10 million to correct its claim the mouthwash prevented colds and sore throats. FTC also demanded that the makers of Anacin spend $24 million to run ads correcting the misstatement that their product relieved tension.

The Federal Communications Commission reined in the powerful TV networks. The financial interest and syndication rules prohibited the Big 3 networks from owning the rebroadcast of prime-time shows. The prime-time access rule effectively shaved 30 minutes of programming and returned it to local stations in top markets. There was a struggle over advertising to children. Action for Children's Television petitioned the FCC to eliminate all commercials from kids TV. Then the National Association of Broadcasters and the networks agreed to reduce commercial time on Saturday mornings. A 1975 study by the Council on Children, Media & Merchandising determined that half of ads in kids programming from 1965-75 was for food, primarily sugared cereal, cookies, candies and soft drinks. Some of the best advertising from a fast-food operation helped convince moms they weren't shortchanging their families as Needham Harper & Steers showed an energetic crew singing "You deserve a break today" for McDonald's Corp. Dannon went to the Republic of Georgia in the Soviet Union to capture a village of centenarians eating yogurt. One spot ended: "89-year-old Renan Topagua ate two cups. That pleased his mother very much."

Other ad techniques and new products that took hold during the 1970s included personalized advertising, the first known example of which occurred in 1975 in a mailing by the Dutch edition of Reader's Digest; the Universal Product Code scanner, in 1977; the first line of generic groceries by Jewel Food Stores. New products also rolled out, including light beers and diet sodas. Xerox Corp. turned to a higher power as it introduced Brother Dominick. The task? Could he produce 500 more sets of his hand-lettered manuscript? Of course, with the help of his Xerox 9200 copier and the memorable punch line of "It's a miracle."

In 1971, a ban on cigarette advertising on TV resulted in a decrease of $150 million in revenue to TV stations and networks.

Although billings eventually picked up, the recession at the beginning of the decade caused most large agencies to experience decreases early on, with a cumulative $15 million in U.S. billings reported lost in 1971, $33 million in 1972 and $11 million in 1973. At the same time, many accounts switched agencies-an estimated 20% to 25% of clients moved from one to another during the decade-adding to agency woes.

But some operations prospered-in 1976, J. Walter Thompson Co. became the first agency to break the billion-dollar mark in worldwide volume. The decade hosted several notable mergers: MacManus, John & Adams joined with D'Arcy Advertising; Interpublic purchased Campbell-Ewald; Ogilvy & Mather bought Scali McCabe & Sloves to name a few. One indicator of industry consolidation was that there were no major independent agencies on the U.S. West Coast by the end of the decade.

African-Americans continued to make inroads in advertising, both in portrayals and in the work force, advancing a trend that started in the 1960s. Blacks appeared in 13% of all ads in 1976, up from 5% in 1967, while minority employment at the two dozen largest ad agencies rose slowly, from 8.9% in 1970 to 10% in 1975.

Media buying shops came into being in the 1970s, and by the middle of the decade their billings exceeded $100 million. These media buying agencies touted their ability to cut bulk-rate deals for marketers.

New media

In 1976, more than 69 million U.S. homes had at least one TV set, and families watched TV for more than 6 hours per day, on average. Advertiser investment in TV that year reached $5.9 billion. But several new technologies were on the horizon that would threaten the broadcast TV industry as it stood in the mid-1970s. In 1975, HBO aired the Ali vs. Frazier "Thrilla in Manila," the first time satellites were used to send scheduled programming to separate cable systems. By 1976, Ted Turner's WTBS in Atlanta had become a superstation going out over cable; WGN was soon to follow. Viacom's Showtime network began in 1978. Bill Rasmussen founded ESPN a year later. It went on to become the most successful basic cable network.

The videocassette recorder also came on the scene. Sony Corp. introduced the Betamax, but JVC's competing format, VHS, eventually dominated. Both companies spent significantly on advertising. While Sony experienced failure with Betamax, it had a hit with the Walkman cassette player, introduced in 1979.

While TV was supposed to kill off radio, it didn't exactly work out that way. Ad volume in radio topped $2.5 billion and FM grew dramatically. Local stations began to embrace packaged, syndicated radio in various formats, in lieu of running DJ-directed local programming. AM and FM radio developed their own personalities, with FM devoted mostly to music and AM mainly to talk and sports. One ominous first during the 1970s: the first known junk e-mail, or spam, was sent over Arpanet, the progenitor of the Internet.

Warner Cable established an interactive/videotex service called Qube in Columbus, Ohio. Households could answer polls by punching Qube buttons. While the plug was pulled by 1984, the system gave marketers a glimpse into the possibilities of one-on-one marketing.

The National Football League's Super Bowl developed into the premier showcase for TV commercials.

Everyday life

Several notable developments in movie marketing occurred in the 1970s. In 1973, the movie "Billy Jack" was re-released, after a weak original run, backed by a major TV ad campaign; before that, marketers devoted more than two-thirds of their budgets to newspaper advertising. The film's $32.5 million box office take caught the industry's notice and changed the way it marketed movies. "Jaws," in 1975, became the first film to benefit from heavy pre-debut marketing and a wide release. Previously, most movies had opened on a few screens with restricted advertising, expanding only if and when they built an audience through word-of-mouth. "Jaws' " success led Lucasfilm and Twentieth Century Fox to follow a similar strategy in 1977 for "Star Wars," which became a blockbuster. It also was the first movie where licensing and merchandising activity generated awareness and big revenue.

"All in the Family" was the top TV show for the first half of the decade, replaced in later years by "Happy Days" and "Laverne & Shirley." Many of the top shows were sitcoms, including "The Mary Tyler Moore Show," "M*A*S*H," "Sanford & Son" and "Three's Company." Early in the decade, "Julia" was the first show to feature a black woman in a leading role.

A number of books found their way into the 1970s zeitgeist, including Erich Segal's "Love Story" (1970), Richard Bach's "Jonathan Livingston Seagull" (1972), E.L. Doctorow's "Ragtime" (1975), Colleen McCollough's "The Thorn Birds" and Alex Haley's "Roots" (both '77). In music, the 1970s gave rise to disco, performed by the Bee Gees and Donna Summer.

A notable fashion trend was the designer jeans craze, which repositioned a utilitarian product as a style-setting icon. The trend started with Jordache's 1978 "You've got the look" ad campaign, followed by the controversial "There's nothing between me and my Calvins" effort for Calvin Klein, featuring Brooke Shields, which debuted in 1980.

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