1990s Information Superhighway

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Population: 248.7 million (1990), 281.4 million (2000)

Employment: 66.5% employment (1990), 67.1% employment (2000)

Peak unemployment: 7.5% in 1992

Presidents: George H.W. Bush (1989-1993), Bill Clinton (1993-2001)

Big names in advertising:

Charlotte Beers, J. Walter Thompson, Ogilvy & Mather; Ted Turner, Turner Broadcasting System; Joe Pytka, Pytka Productions; Maurice Saatchi and Charles Saatchi, Saatchi & Saatchi

Top agency in 1990: Young & Rubicam ($7.3 billion)

Top advertiser in 1990: Procter & Gamble Co. ($2.3 billion)

Total U.S. ad spending in 1990: $128.6 billion

Although the economy was still weak in the early 1990s, in the aftermath of the stock market crash of 1987, the latter part of the decade saw an economic boom. The ad industry also experienced a comeback after a few years of cutbacks, and in 1998 ad spending surpassed $200 billion. It was a period of demographic change, with the baby boomers aging-Bill Clinton was the first baby boomer to become president-older Americans moving to the Sun Belt, the birth rate declining and immigrant and U.S.-born minority populations rising. All these trends created new consumer segments for advertisers to target. The decade began with the first Persian Gulf War, late-night host Johnny Carson and U.K. leader Margaret Thatcher retiring, the Clean Air Act passed and spotted owls being determined to be endangered, throwing the Northwest logging industry into chaos. The Soviet Union crumbled and Earvin "Magic" Johnson tested HIV-positive.

AIDS became the overriding social issue, with the U.S. government buying TV airtime for AIDS awareness spots for the first time. Riots erupted in Los Angeles after tapes of the Rodney King beating were aired, and the World Series flag was flown outside the U.S. in Toronto. Michael Jordan retired for the first time, and terrorists set off a bomb in the World Trade Center parking garage. South African blacks voted, and O.J. Simpson rode in the white Ford Bronco with America watching the chase. Oklahoma City and the Atlanta Olympics were bombed. Daisy the sheep was cloned, and Princess Di was buried. The Unabomber was caught and convicted, and White House intern Monica Lewinsky nearly toppled a presidency. Everything happened faster as the Internet boomed, and later burst, but drove many developments in communication, media, retailing and advertising.

Advertising

The buzzwords of the 1990s were "integrated marketing," as clutter in traditional advertising venues made it important to reach consumers with a consistent message through a variety of media.

Some estimates placed the number of commercials on the four broadcast TV networks alone at 6,000 per week, with recall of those ads at 4% in 1990, less than a quarter of the 18% levels of 25 years earlier.

To counteract this trend, marketers looked toward alternative techniques such as database, interactive media, sales promotion, direct response, PR and viral marketing, and segmentation by ethnicity and other character- istics.

While TV commercials held their allure as frogs performed well for Budweiser and polar bears for Coca-Cola, the demand for specialty services remained strong. Agencies rose to fill that need; technology rendered physical location irrelevant, and small companies launched across the nation and the world. Advertisers gave some of their niche work to these specialists, dividing their business among several service providers as well as their agencies of record. As a result, agencies had to reinvent themselves by starting in-house departments to handle the specialized tasks their clients demanded. Several big agencies eventually began to spin off their specialist divisions into independent companies. This included unbundled media shops like Bcom3's Starcom and MediaVest, Grey's MediaCom, Interpublic's Initiative Media Worldwide and Universal McCann, Omnicom's OMD Worldwide and PHD, and Cordiant's Zenith Media, WPP's MindShare, and Young & Rubicam's Media Edge. Methods of agency compensation changed as well, becoming increasingly linked to results.

The Federal Trade Commission loosened its rules for direct-to-consumer broadcast ads for pharmaceuticals in 1997, resulting in a flood of DTC spots that appealed directly to end-users rather than doctors, despite the fact that advertisers were required to mention the major side effects in the ads. TV ad spending in the pharmaceutical category tripled in two years, from $309 million in 1997 to $1.1 billion in 1999. Then, as the world braced for the dreaded Y2K meltdown, Ad Age editors challenged themselves by pondering: Who were the five greatest marketers of the 20th century? An opinionated bunch, the editors argued for a wide range of protagonists but settled on: No. 5, Nike, for edgy creative that turned a commodity into a fashion statement; No. 4, Anheuser-Busch, for understanding the nuances of brewing and its target market, and connecting the dots brilliantly; No. 3, Coca-Cola Co., for developing the first truly global brand; No. 2, McDonald's Corp., for backing an emotional message with heavy, wide-ranging ad spending to sell America on a different way to eat. Actually, No. 1 was the easiest pick of all for the editors. From 1882 on, Procter & Gamble Co. grasped the power of advertising. It invented the brand management system and developed proprietary research, the soap opera, test marketing and long-term agency relationships, and often embraced new media before competitors.

New media

The 1990s was the decade of the World Wide Web. The first "dot-com" agencies came into their own, with Modem Media a pioneer in the late 1980s, followed by others, including Poppe Tyson, in the early 1990s. The first Internet ad was a banner ad for AT&T on HotWired.com in 1994; HotWired's success in attracting advertisers led other online services to offer this opportunity as well. Early advertisers on HotWired, which charged $30,000 for a 12-week run on its site and generated initial click-through rates as high as 40%, also included Club Med, Coors' Zima brand, Harman International Industries' JBL speakers, IBM Corp., MCI Corp. and Volvo Cars North America. In the mid-1990s, MCI became one of the first major advertisers to create a campaign that appeared both in traditional media and on the company's Web site, while the first Web measurement service, I/PRO, was founded in 1994. By the mid-1990s, total Web ad spending was $300 million, and by 2000 more than triple that, according to Jupiter Communications. The Internet audience was estimated at more than 60 million in the U.S. alone by 1997-98.

Companies such as Amazon and eBay were early players in e-commerce, which allowed marketers to sell products directly to consumers, as well as collect data about them. Many e-commerce companies began by offering a single niche product, but the landscape quickly became more sophisticated as specialist sites expanded their product ranges and bricks-and-mortar retailers and major online portals tested the market. Internet commerce reached $8 billion by the late 1990s, though most companies were not able to show a profit.

DVD players were introduced in 1996, with manufacturers spending $150 million to market the first DVD players and discs that year. The 1990s also gave rise to the Palm Pilot, the first handheld computer and personal information manager to achieve mainstream popularity; and the wireless phone.

Everyday life

The World Wide Web touched the entertainment industry and nearly every other aspect of daily life. In 1999, the low-budget independent feature "The Blair Witch Project" became a hit due to an Internet marketing campaign from Artisan Entertainment that made young consumers feel like they had discovered the film themselves, and generated strong pre-release word-of-mouth. The "Blair Witch" campaign was a landmark in the development of the Web as a critical movie marketing technique. Other hits included "Forrest Gump," "The Lion King," "Star Wars: Episode I-The Phantom Menace," "Jurassic Park" and "Home Alone."

The 1990s saw specialty retailers emerge as fashion brands, with the Gap, Abercrombie & Fitch and Victoria's Secret among the examples. Victoria's Secret experimented with Internet marketing in 1999 when it promoted a Valentine's Day Webcast fashion show during a single spot within Super Bowl XXXIII. The effort generated controversy, but it also garnered enough response to crash the site during the Webcast.

Talk radio's influence increased, starting with the likes of Larry King and Dr. Ruth Westheimer, and expanding to Howard Stern and similar shock jocks as well as conservative commentators such as Rush Limbaugh and Dr. Laura Schlesinger. The talk trend boosted listenership of AM radio, which had declined in reach from 61% of adults listening per day in 1975 to just 26% in 1989, and began to expand into FM radio and television. On TV, gay characters became the leads in sitcoms such as "Will & Grace" for the first time.

John Grisham and Anne Rice began their long runs on the best-seller lists in the 1990s, and people were talking about Robert James Waller's "The Bridges of Madison County" (1993) and James Redfield's "The Celestine Prophecy" (1994). The music charts featured boy bands and girl groups, from New Kids on the Block to the Spice Girls, joined by female balladeers such as Mariah Carey and the first superstars of rap, including Boyz II Men.

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