Ad cuts send hard message

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It should be plain now that advertising's advocates-inside client companies and outside in the agency and media worlds-have their work cut out for them. There's more to be done, perhaps much more, before CEOs, chief financial officers and corporate boards are convinced advertising and brand building are truly essential business activities no matter what the economic climate may be.

The current ad slowdown should be humbling for anyone convinced that advertising investments had a secure position with corporate managements. Zenith Media Chairman-CEO John Perriss was candid about this as he and other ad industry forecasters discussed future prospects with Advertising Age editors in last week's issue.

The continuing fall in corporate profits among the world's largest advertisers, Mr. Perriss observed, "has caused them to take a view which I didn't think advertising would do anymore, which is to take the short-term cut to marketing budgets, such as advertising, in order to maintain profitability." Many client executives, he said, "openly admit they were put under pressure by their boards to meet quarterly earnings targets, and they took the easy option and cut the ad budget."

Of course, advertising and marketing budgets are no more immune to re-examination than any other area of corporate investment in the face of a national emergency and a slumping economy. But we suspect top managements, in their eagerness to protect profits at all cost, may still have a poor appreciation of the opportunities-present and future-that are forgone when well-thought-out marketing plans are unnecessarily delayed or abandoned.

This frustrates marketing and advertising people who have weathered economic upheavals in the past, and who know savvy marketers have found ways to win gains in difficult marketplaces. As former Interpublic Group of Cos. CEO Philip H. Geier Jr. wrote (Letters to the Editor, AA, Sept. 10), "the facts speak for themselves" about marketers who learned "that recession can be not a life-threatening risk but a window of opportunity."

Media companies, ad agencies and ad-industry groups have all supported efforts to promote advertising to corporate senior managements. What's happening at too many companies today suggests this message has not been convincing, or has never penetrated beyond those already converted. Before advertising can sell consumers, it seems, it needs to sell itself-again-to more CEOs and corporate boards. The sooner the industry recommits itself to that task, the better.

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