It's the 1980s, the "Decade of the Deal" in the advertising industry, with advertisers and their agencies forming mega-companies through mergers and leveraged buyouts. Kohlberg Kravis Roberts & Co. buys Nabisco, Philip Morris buys Kraft and large agency holding companies—from Interpublic Group of Cos. to WPP Group to Omnicom Group—grow rapidly via M&A activity. Behind the scenes, technology is driving changes in the ways these companies do business and reach their target audiences.
Overall, it's a time of relative peace and affluence, though the decade is not without its challenges: the AIDS pandemic, the Cold War and eventual collapse of the Berlin Wall, the stock market crash of 1987 and the explosion of the space shuttle Challenger, to name a few. Abroad, societies and their political structures are changing rapidly, and Western brands adapt and expand accordingly, with Coca-Cola Co., General Electric Co., McDonald's Corp. and Microsoft Corp. leading the way into Eastern Europe.
TV is the dominant ad medium, and it's evolving on several fronts—from what viewers watch to how they watch it. With its debut in 1984, "The Cosby Show" reinvigorates the sitcom genre and, with its portrayal of an upper-middle-class African-American family, departs from depictions of black families viewers had seen on earlier shows such as "Sanford and Son," "Good Times" and "The Jeffersons." "The Cosby Show" is the No. 1 program for four years running and, in 1986, generates a record $400,000 for a 30-second spot. Other popular shows of the decade include prime-time soap operas such as "Dallas" and "Dynasty," dramas including "Miami Vice" and "Hill Street Blues," and sitcoms such as "Cheers," "The Golden Girls" and "Family Ties."
From a business standpoint, TV changes significantly in the 1980s. The rapid rise of cable TV and the beginning of syndicated programming accelerate the industry fragmentation that began in the 1970s. Direct-response shopping services such as QVC and Home Shopping Network make their debut. MTV's launch in 1981 revolutionizes the way music is consumed and marketed. ESPN, HBO and Showtime continue to grow, and the first direct-to-home satellite system—DirecTV—is unveiled in 1988. The Big 3 broadcast networks are fragmented further when the Fox network launches on broadcast TV.
Meanwhile, the VCR continues to gain traction, giving viewers the ability to skip ads on programs they've recorded. The remote control makes its way into American homes, also enabling viewers to channel surf during commercial breaks. Compact discs are introduced in 1983, and digital cameras and flatbed scanners begin to change the way print ads are produced.
In a development that will eventually have huge implications for marketers, personal computer use goes mainstream. Time magazine names the home computer the "Machine of the Year" for 1982 in lieu of its "Man of the Year." In 1984, Apple launches the Macintosh with its "1984" Super Bowl commercial, establishing the big game as a premium sports marketing venue. The spot, directed by filmmaker Ridley Scott for Chiat/Day, makes a big splash: Some 200,000 people visit stores the next day to see the Mac, and 72,000 customers buy one within three months.
The widespread adoption of PCs becomes a defining legacy of the decade, and enables advances in software that will make advertisers' efforts far more sophisticated in the coming years. It also sets the stage for a key technological leap of the 1990s: the birth of the Internet and integrated marketing.
Next week: The 1990s
Previously: The 1970s
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