Just last May Procter & Gamble's Ed Artzt warned that advertiser-supported TV might not have a future "in a world of video-on-demand, pay-per-view and subscription TV."
These forms of programming are designed to carry "no advertising at all," he said. As a result, mass marketers like P&G "will have a hard time achieving the reach and frequency we need."
Cut to an industry conference the other Friday to examine advertising's role in the future video market. Now, as we reported, big-spending marketers declared that they're no longer satisfied to just have a presence in the new media. They want to control the content of the new media.
"Advertising is programming and programming is advertising," one speaker said.
The walls are already crumbling. Home shopping networks are one long commercial.
Mr. Artzt talked of providing consumers with CD-ROMs on how to take care of a cold, sponsored by Vicks. "You can't do that on broad-based media," Mr. Artzt said. "We have a lot of interest in that."
I got the feeling that advertisers have gone from total despondency about being shut out of the new media to total assurance that they will control it. As Mr. Artzt said: "Advertisers and agencies are better prepared today than ever before to capitalize on the technologies that are changing the way consumers receive and use information and entertainment."
I think the realization is beginning to dawn on P&G and other big advertisers that they can meld information and entertainment into infotainment-a seamless way of delivering a continual product message, not just in 30-second portions around non-related programming. And they can own and control the medium itself, in the form of CD-ROMs they can send to precisely the consumers who are most likely to buy their products.
Advertisers have even come to grips with the fractionalization of TV in the age of 500 channels. "Fragmentation might be a good thing," P&G's research and new media expert, Bob Wehling, said. "Clearasil doesn't want to reach everybody, and on the other end, neither does Attends." I don't think a pun was intended.
If I were an ad agency, I'd be plenty worried. Last year, after Mr. Artzt's speech, agency executives worried that he was asking them to get back into programming. Now they should worry that advertisers don't need them at all.
"I don't want agencies to think there's a need to restaff," Mr. Artzt said. He said there's no need to re-create expensive and duplicative services provided by other sources.
Come to think of it, does P&G need agencies to produce a Vicks cold remedy show on a CD-ROM?
Agencies may be in for a tough patch ahead, but Mr. Artzt, from what I observed, is retiring in a much better frame of mind.