A LOBBYIST'S FAREWELL WARNING TO THE AD INDUSTRY

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April 16, 2001

By Ira Teinowitz

WASHINGTON (AdAge.com) -- Hal Shoup looks back on 12 years as the Washington lobbyist for ad agencies with both a warning and a mixture of satisfaction.

As the longtime executive vice president of the American Association

Hal Shoup: 'You can get beat up pretty bad.'
of Advertising Agencies rode off into the sunset -- or at least to a house in the Virginia horse country -- he worried that the constant pummeling the ad industry gets from critics could take a toll on the industry and its hiring.

The 70-year-old Shoup warned that various charges against the industry -- violent movies and videos being advertised to children, ads unfairly targeting children for other products, direct-to-consumer ads inflating the cost of drugs, advertisers unfairly using the Web to profile and target consumers -- could cost the ad industry even without legislation.

"You can get beat up pretty bad as an

industry and that can have falloff in all kinds of ways," Mr. Shoup said. "Our biggest challenge is to attract the best and the brightest. ... You have got to get very, very good people. If an industry has a lousy image, are you going to be able to attract the best and the brightest MBAs?"

Industry must sell itself
He reiterated the the need for the industry to get across its own worth, saying it needs to tell its story.

"It is important that the image of advertising reflect the fact of advertising," he said. "The fact is this is a good business with good people who are smart as hell who are inclined to help legitimate clients sell legal products."

Aside from advertising's image, Mr. Shoup said the biggest problem the industry faces in preventing ad curbs is that proposals to restrict ads often start out sounding like mom and apple pie to legislators.

Get to the legislators
"Quite frankly, you have to be way out in front. You have to make sure that you very quickly get to the people writing [legislation] or the people who oppose them to try to get [bills] changed or dropped or altered because they are issues that sound good. They are tough to oppose because they seem to be a good thing until you begin to look and say, 'What kind of a precedents are these going to establish?' and 'Are these really going to solve the problem that they are addressing?'"

While generally sanguine that there won't be major advertising legislation this year, Mr. Shoup remained worried that privacy legislation, marketing to children and increases in spending on pharmaceutical ads could still attract congressional scrutiny. He also worried that any reluctance of the Bush administration and the GOP Congress to take on issues might prompt state attorneys general to act and that states facing a recession and desperate to find money will look to taxes on services, including advertising.

First Amendment protection
He is also proud that his tenure with 4A's saw dramatic improvement in legal protection for advertising as the U.S. Supreme Court moved to provide the ad industry more and more First Amendment protection -- something that makes enactment of advertising restrictions less likely.

"I can remember when you would mention commercial free speech and say, 'You can't do that because it is a violation of the First Amendment,' and they would sort of roll their eyes and say, 'That's not for us to worry about. That is going to be up to the court,'" he said. "Now, 12 years later, they say, 'We know that we can't put that into the law because it's [a violation] of the First Amendment.' That concept of protection of commercial speech by the Constitution has become institutionalized."

Mr. Shoup, formerly an ad executive at Cleveland agency Liggett-Stashower, retired last month as the longest-serving lobbyist for ad agencies. His post is now held by Richard F. O'Brien, who before joining 4A's was most recently executive vice president of the Special Olympics. Mr. Shoup said he leaves feeling pleased that some of the biggest threats to the industry seem to have evaporated for the moment, or perhaps fallen victim to the GOP wind that blew through Washington Jan. 20.

Tobacco ads and the courts
There appears to be no threat to change the deductibility of advertising this year as there has been in the past. The battles over requiring warning messages in alcohol advertising appear minor now. The remaining battles over tobacco advertising seem destined for the courts. Further, relations between the Federal Trade Commission and the ad industry are friendly.

Not that there aren't battles this time or that ad agencies' fortunes can't take dramatic turns quickly.

"You can't go to sleep, because things change. Yeah, we have a nice situation now, but what is going to be the situation six months from now? The majority in the Senate, that can change. And then you have 535 people up there [in the House and Senate] and you don't know when any one will come forth with something that has nothing to do with their committee assignments or party that has a profound effect."

Copyright April 2001, Crain Communications Inc.

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