Imagine paying to subscribe to a premium cable TV channel, then finding out the programming schedule is dominated by infomercials. That's the position in which marketers attending last week's Association of National Advertisers conference in sunny Laguna Niguel, Calif., found themselves. Having paid to attend the meeting, attendees then had to sit through three days of what amounted to sales pitches from the Big Four TV networks.
ABC, CBS and Fox paid an eye-popping $100,000 apiece to sponsor each day's session (NBC sponsored the "welcome" dinner, price tag unknown). We're not talking here about typical convention sponsorship, in which a media company or vendor gets signage at the coffee break or a "thank you" from the podium.
The networks basically controlled the look, feel and content of the conference, slapping logos all over the stage, blasting promotional clips from TV screens and trotting out their on-air talent. Making sure to get a full return on investment for their marketing expenditures (a.k.a. their money's worth), the networks began each day by delivering blatant pitches to the nation's leading advertisers ("Our shows are great. Our demos are better.").
The network sponsorships sparked resentment among magazine publishers, many of whom attended the conference but felt their medium was not represented on the agenda. The response from some advertisers: Magazines will get their chance next year.
They shouldn't. Blatant sales pitches from publishers rather than programmers won't solve the problem. The best solution is for ANA to announce, sooner rather than later, that its experiment in developing an alternative format was a failure and won't be repeated. The network sponsorships may have poured $300,000-plus into the association's coffers, but they provided no value to ANA members beyond the thrill of meeting Ted Koppel. In fact, they diminished the value of the conference by diluting the content.
What ANA did was nothing short of sell its annual meeting for money. Next year, it needs to buy it back.
By and large, the good times are still rolling in the advertising world. McCann-Erickson Worldwide forecaster Bob Coen, feeling even rosier about the year than when it started, now sees U.S. ad spending growing by 6.2% this year. The superstitious have weathered the 10th anniversary of the "crash" of '87 without the sky falling. Profits are generally decent to good; inflation is low and Alan Greenspan rumbles but doesn't intervene.
What's wrong, then? It is this: Despite the good times, those nicely growing marketing and advertising budgets are under pressure-not from general business conditions, but from restive top managements that want harder evidence of what sort of "return" they are getting on this huge investment.
It's no coincidence the Association of National Advertisers has just released a book it commissioned, excerpted on our Forum page last week, examining how "return on investment" might be calculated on marketing budgets. Nor is it happenstance that Information Resources Inc. and Media Marketing Assessment are starting a study aimed at uncovering the actual impact of TV advertising on the sales of package goods. Or that a big advertiser, Kraft Foods, has signed on to back it.
When the economy cools, and the chief financial officers start looking for costs to prune, demonstrating the ROI of ad budgets will be an urgent issue. The question is: Will the answers be there?