ISSUES LOST IN THE COZY CALM OF ANA MEET'S 'SPONSOR' DAYS

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Outside, rome is burning."

The words were spoken on the palm tree-lined back lawn of a Ritz-Carlton hotel by a mischievously smiling man with a cold drink in one hand and a crisp spring roll in the other. They weren't in response to any question, but the meaning was clear.

This was at the annual meeting of the Association of National Advertisers in Amelia Island, Fla. Earlier that day, similar sentiments were voiced by a man in sunglasses and a baseball cap on a boat leisurely cruising the Intercoastal Waterway on a sunny afternoon, its passengers captivated by a school of dolphins in the water and a herd of wild horses on the shore.

"It's nice to know," he said, squinting into the sun, "there are no problems in the world." Again, no translation was needed. The reference was not only to the beauty of the surroundings but the content of the ANA meeting. Based on the first two general sessions, it appeared marketers are conducting business in an environment as lushly untroubled as the conference setting. The sessions had been mildly entertaining-a Charlie Rose-moderated panel of editors from The New Yorker, GQ and Vanity Fair, a conversation with a trim and surprisingly soft-spoken Rush Limbaugh-but about as substantive as cotton candy.

That would change on the last day, with a morning session sharply focused on one of the toughest challenges faced by marketers: the impact of interactive media on marketing communications and commerce. On that day, ANA fulfilled its mission and showed how to stay relevant.

Continued economic prosperity aside, these are tumultuous times in the marketing world. Retailer consolidation, difficulties in recruiting and retaining talent and channel conflicts caused by the Internet are redefining how major manufacturers market goods and services. Keebler Foods President David Vermylen captivated the audience on the third day of the conference with elfin magic. But in a one-on-one conversation at dinner the night before, he spoke soberly about the problems faced by package goods marketers in the Wal-Mart age.

"By far, the biggest issue is retailer consolidation," Vermylen said. "More and more marketing dollars are going to retailers, who are in the real estate business. We need to figure out how to use those dollars for brand building, not just price promotion."

Channel conflict is also, of course, a huge challenge for marketers as they weigh the ability to sell products directly to consumers against the need to maintain relationships with bricks-and-mortar retailers.

One way around the issue, said John Pepper, retired chairman of Procter & Gamble Co., is to use the Internet to sell products that don't generate sufficient volume to justify store distribution, such as Pampers sized for premature babies.

These are the topics that should dominate the agenda of ANA's conferences. They don't because for the last three years the association has stubbornly stuck by a format under which media companies pay $100,000 per day to sponsor general sessions. The sponsors use the time to promote their wares to an audience of potential advertisers.

This year, the first two days of general sessions featured sponsored content and were essentially useless. The third day, with its non-sponsored focus on e-commerce, was provocative and relevant.

The lesson is so obvious that ANA's unwillingness to admit to and correct its mistake is immensely frustrating. Instead of setting its agenda based on addressing the biggest marketing challenges, the association insists on setting it based on which media companies are willing to fork over dough to make a sales call.

ANA was right to abandon a silly plan to invite agencies to join as members. If it wants to make its annual conference as valuable for its content as for its networking opportunities, it now needs to abandon the sponsored programming