UNILEVER CHIEF'S AD CHALLENGE: FITZGERALD SAYS AGENCIES NEED TO LOOK BEYOND TV, EXPAND MEDIA

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Niall FitzGerald, chairman of Unilever, which spends $6.5 billion a year on marketing, has struck out at ad agencies' failure to look beyond advertising, pointing out an "alarming discrepancy between what our brands are going to need and what contemporary agencies are good at."

Mr. FitzGerald told delegates in Dublin for the annual meeting of the European Association of Advertising Agencies Oct. 10 that the "vast and irreversible" changes taking place in communications do not favor network TV-the medium on which agency skills, reputations and profits have focused for the past 40 years in the U.K., and longer in the U.S.

For example, he said, Unilever's Ragu brand has had its own Web site for two years, registering more than 1 million hits. He said the technology required new copywriting skills and the ability to understand not just the brand but the nature of the medium and the likely state of mind of each consumer participant.

"I worry about how many traditional agencies have such skills available, or even, sometimes, if they know the need exists . . . I do not find today's advertising agencies being much of a match for tomorrow's marketing opportunities."

TV STILL STRONG FUTURE

But, Mr. FitzGerald said, that didn't mean a jettisoning of old techniques in favor of new.

"All I am asking you to understand is that competence in television is no longer enough," he said, adding: "In many countries, network television has its best years still ahead of it."

Indeed, new media opportunities were not necessarily all in what is conventionally regarded as "new media," he suggested.

Moves by Unilever to make products cheaper for people in poor, rural areas-such as in India, where less than half the population can afford to use toothpaste and only one-sixth wash their hair with shampoo-has led to novel promotions.

ADS ON SHOP FRONTS

In northeastern Brazil, for example, Unilever has converted the fronts of shops where these products are on sale into giant orange advertising boards.

"I do not want to have to choose between an agency that understands interactive advertising and one that understands how to turn shopfronts into giant billboards," Mr. FitzGerald told the meeting. "I want them to be good at both."

He also warned multinational agencies of growing too large and out of touch with national and regional characteristics.

"I will not accept as inevitable the fact that our agencies, because they are big, are less agile than some of their smaller competitors. If our agencies become no more than efficient distribution systems, then we will have to go elsewhere for our ideas. We cannot afford to choose between competence and creativity."

Unilever's global roster agencies are Ammirati Puris Lintas, McCann-Erickson Worldwide, Ogilvy & Mather Worldwide and J. Walter Thompson Co.

Western Europe, as a static market for the sort of everyday goods Unilever produces, represents a challenge to advertising to enhance brands and protect their margins, the executive said. But Mr. FitzGerald said the real "glittering prizes" for Unilever lie elsewhere.

The gross domestic products of Argentina, Brazil, China, Hong Kong, India, Indonesia, Malaysia, Mexico, Poland, Singapore, South Korea, Taiwan, Turkey and Vietnam are growing two to three times faster than those of Western Europe, for example.

He cited one piece of evidence: the average Spaniard eats just more than 5 liters of ice cream each year, but each Ecuadoran-a 10th as wealthy-gets through 6.

OPEN TO INDEPENDENT MEDIA

In other developments, EAAA opened its membership to media independents for the first time. Besides being full members, they will form a media council within the group. Stig Carlson, director general of Brussels-based EAAA, said the move gives the organization a needed third leg, by adding media agencies to the international agency networks and national agency organizations that currently

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