WELLS RICH GONE
After 32 years, Wells BDDP, shut its doors in May. Omnicom Group bought Wells' parent GGT Group for $234 million in January and then shuttered the agency following $1 billion in client losses. Ad legend Mary Wells Lawrence founded the agency as Wells, Rich, Greene, and it is fondly remembered for creating famous slogans such as "Flick my Bic" and Alka-Seltzer's "I can't believe I ate the whole thing." That didn't stop a flood of defections, though, that began when Procter & Gamble Co. ended a long and lucrative relationship with the shop.
ANA'S RED CARPET
In opening its doors to ad agencies for full membership, the Association of National Advertisers threw itself open to controversy. ANA put the matter to a vote before its membership at its annual meeting in October--and then informed the American Association of Advertising Agencies. As soon as the call went out, Procter & Gamble Co. fired off a letter urging its roster of agencies to join. The Four As, wary that ANA was encroaching on its business--and potentially siphoning off dues--responded with a not-so-subtle letter to its members reminding them that it fulfills all their needs. At press time ANA, which expects to focus initially on the 25 largest agencies, hadn't yet come up with a fee schedule or criteria for their "partners in brand building."
Mergermania continued in 1998 with traditional agencies, direct marketing and media shops all feeding on one another. Snyder Communications stood out as one of the biggest feeders, led by its buy of Arnold Communications. Others who bid farewell to independence day in '98 included Hal Riney & Partners; Hill, Holliday, Connors, Cosmopulos; Avrett, Free & Ginsberg; and Carmichael Lynch. The biggest buy in media came when Havas Advertising bought one of the largest remaining independents, SFM Media.
Tobacco ad restrictions were a series of starts and stops as various alternative curbs were unveiled, intensified, then ripped apart as "sweetheart deals." State attorneys general embarrassed a bickering U.S. Congress by reaching their own pact to settle state tobacco claims. The $206 billion agreement requires the removal of $150 million in outdoor ads and limits sponsorships to a single series per tobacco maker (with a few exceptions). It also bans Joe Camel ads and cartoon characters and funds a $300 million per year anti-smoking ad campaign. The larger issue remains unresolved. Food & Drug Administration tobacco rules, overturned by an appellate court, will likely go to the U.S. Supreme Court next year with the prospect some curbs that never made it still could be reinstated.
So long, SEINFELD
The biggest TV event of the year was clearly the finale of NBC's "Seinfeld." With hype galore--and prices approaching $2 million for a 30-second commercial--the show was seen by an estimated 76.3 million viewers. It garnered a 41.3 rating with a 58 share. That audience was nowhere near the estimated 106 million people who saw the final episode of "M*A*S*H" in 1983, but back then the networks had a lot less competition. "Seinfeld" has been sorely missed by NBC. Without the big audience that followed the show in its last season, the peacock network is off about 18% in adults 18 to 49.
Sammy, Mac & Yanks prove BASEBALL'S BACK
Holy Cow! Major League Baseball was back at bat and swinging strong after a tense and apathetic four years following the 1994 strike. Fans returned and a number of sponsors renewed their deals. The success was due, in part, to the home-run race between Mark McGwire and Sammy Sosa and the record-setting, World Series-winning Yankees . Mr. McGwire ultimately set the homer mark and appeared on 1.2 million boxes of Wheaties. MLB and the Players Association took advantage of the hype to launch a joint promotion directed at young fans.
Edgy Miller `DICK' ads miss the mark
When Miller Brewing Co. launched its aggressively postmodern and expensive "Dick" campaign for Lite beer in early 1997, it gambled the quirky ads by Fallon McElligott, Minneapolis, would reel in twentysomething drinkers. Not until late 1998 did it admit it lost, throwing the account into review.
WHITE HOUSE DOES DRUG ADS
"Just say no" didn't work very well at stopping drug use. Will advertising? The country is seeing its first test this year as the Clinton administration convinced Congress to spend about $175 million a year for paid anti-drug ads. Broadcasters and publishers in theory get to run one paid-for ad for every free one they run. The ads started running early this year and went national in the summer. The two big winners of the campaign are the Partnership for a Drug-Free America and Bates USA, New York. The partnership creative is being used for the campaign and Bates won a government contract to buy what is likely to be $125 million in advertising time and space.
Young & Rubicam went public May 11, ending a year of speculation. The stock shot up to $28.06 per share, far higher than the agency's estimate. Management, employees and investment bankers Hellman & Friedman--which bought a stake in the company in 1996--shared in a $466 million payday. The initial public offering also made multimillionaires of several longtime Y&R executives. Some headed for retirement, including Y&R Advertising Vice Chairman-Chief Client Officer Mitch Kurz, who was replaced in a structuring by Linda Srere. In November, Y&R followed its initial registration with another block of up to 11.5 million shares, raising another $300 million.
NEW NFL RECORD SET
Three of the four major broadcast networks and ESPN paid a whopping $17.6 billion for the rights to show National Football League games over the next eight years. CBS paid $4 billion for the rights to the American Football Conference, Fox paid $4.4 billion for the National Football Conference and Walt Disney Co. paid $9.2 billion to show Sunday night games on ESPN and Monday night games on ABC. ESPN, which can pass on some of its NFL costs to cable operators, should make money on its deal. NBC, and Wall Street, declared the nets would lose money.
Copyright December 1998, Crain Communications Inc.