The American business scene changed dramatically at the turn of the century. From 1898 to 1902, a wave of mergers consolidated 2,653 independent firms into 269 large-scale corporations, called "trusts," which controlled such basic industries as railroads, coal, iron, copper, oil, steel, sugar and tobacco. While those newly consolidated companies had relatively few brands, they wielded great blocks of capital and dominated the markets in which they operated.
Advances in production coincided with the country's explosive growth in population, from 31 million people in 1860 to 105 million in 1920. In the 20-year period following 1900, the annual volume of advertising surged more than fivefold, growing from $540 million to just less than $3 billion.
Incomes steadily increased, and many consumers had money left over after they paid for necessities, which created a demand for more consumer goods: ready-to-eat breakfast cereals, lightbulbs, vacuums, irons, toasters and washing machines. Other products, such as player pianos, phonographs and board games, appeared entirely for consumers' enjoyment, while the automobile changed the way millions spent their leisure time.
Henry Ford brought the automobile within reach of millions of Americans and, as road travel increased, the billboard industry developed as a means of addressing the newly mobile public. In 1900, the first standardized structure for displaying posters was developed. (Before this, outdoor advertising had been limited to the placing of messages on buildings, fences and other existing structures.)
Perhaps more than anything else, marketing and packaging stimulated the consumer economy and created a revolution in retailing. Improved transportation and distribution systems allowed canners and bakers to ship their goods beyond established markets. Inevitably, the need for new forms of packaging appeared.
Colorful descriptive labels on packages further assisted shoppers, transforming generic products into unique ones. Packages also allowed cost comparison, as more stores affixed prices to the merchandise. In cities, shoppers flocked to department stores, which provided luxury, comfort and convenience as well as strong point-of-purchase selling incentives. At the same time, giant mail-order companies offered to fulfill rural Americans' every need, from patent medicines to the latest gadgets for home or work.
Chain stores developed soon after. Such centrally managed operations?which placed large orders, established low profit margins and made money through volume sales?included the Great Atlantic & Pacific Tea Co., Woolworth's Five & Dime Stores and J.C. Penney Co.
Women became the nation's primary purchasers of consumer goods, making 85% of consumer purchases. In advertising, however, women worked on products for the women's market (food, soap, fashions and cosmetics). Men moved through training programs, working through all the departments to find the right job. Women started lower, as secretaries or researchers, trying to get noticed as copywriters.
Despite this climate, a few women rose to prominence. On the agency side, Helen Lansdowne Resor had a brilliant career as a copywriter and creative supervisor at J. Walter Thompson Co. Helen Rosen Woodward, one of the first prominent female account execs, worked for the Presbrey and Gardner agencies. Later, the manpower shortage during World War I and the postwar economic boom reopened opportunities for women in advertising.
By the turn of the century, successful marketers recognized the importance of well-coordinated promotional planning to push the sale of particular brands and introduce new ones. With newfound, full responsibility for campaigns, agencies evolved from space agents into their present form in the first decade of the century, and ads became a single component of planned campaigns that had to be integrated into appropriate marketing strategies. Skilled copywriting, layout and illustration became important in achieving continuity and strengthening selling appeals.
In agencies' early years, agency principals wrote the copy. Even after agencies began to hire established writers to pen ad copy, "art managers" typically sent ads in rough layout form to the printer. That changed, however, when designers and artists joined the staff and asserted that the "look" of an ad was just as important as the words.
The role of the account exec expanded from bringing in new business to serving as a liaison between the client and the creative staff, while media buyers continued to see that the ads were placed in the best possible location and shopped for the best possible deals.
Uneeda Biscuit set the standard for a well-coordinated ad strategy to introduce a new product. The newly formed National Biscuit Co.'s first move was to create a brand-name cracker. To preserve the crackers' crispness, the marketer packaged them in airtight, waxed paper-lined packages. For the name, New York-based N.W. Ayer & Son suggested "Uneeda" (pronounced "You-need-a"). Ayer also created the Uneeda trade character?a boy in a rain slicker-along with the catchy slogan: "Lest you forget, we say it yet, Uneeda Biscuit."
Other characters also became the trademarks of the products they advertised, including the Gold Dust twins, Sir Thomas Lipton, the Dutch Cleanser housekeeper, Aunt Jemima, the Campbell Kids, the Morton Salt girl, Buster Brown, Planter's Mr. Peanut and Cracker Jack's Sailor Jack. Animals also became brand symbols, including Camel cigarettes' Joe Camel and Nipper, the RCA dog.
Earnest Elmo Calkins of New York-based Calkins & Holden refined the art of the advertising, emphasizing the ad itself instead of the media selection or the size of the advertiser's budget. If an ad had the "look," it would stop a reader from turning the page of the magazine or newspaper. This look built an image for the product and integrated branding, advertising and other promotions.
To execute his visions, Mr. Calkins hired artists such as Joseph Leyendecker, known for his Saturday Evening Post covers, who painted the Arrow Collar Man for Arrow Shirts. Other successful C&H soft-sell campaigns, as the emotional appeals were known, were developed for Force cereal, Pierce-Arrow cars and the Lackawana Railroad.
Calkins & Holden's richly illustrated ads were soon imitated. Maxfield Parrish's meticulous painting style appeared in stunning ads for Fisk Tire and Community Plate Silver. The illustrator N.C. Wyeth filled ads for Cream of Wheat with cowboys and gold miners. Norman Rockwell painted realistic figures with a humorous touch for everything from Heinz baked beans to Grape Nuts cereal.
In the early 1900s, pioneering admakers first introduced the idea of the sales argument, called "reason-why copy." The new approach used a selling pitch designed to overcome resistance rather than merely keeping the advertiser's name before the consumer.
Reason-why practitioners such as John E. Kennedy, Claude Hopkins, Albert Lasker and Helen Lansdowne Resor established the copywriter as crucial to the American ad agency. Mr. Kennedy, hired as Lord & Thomas' chief copywriter in Chicago in 1904, extolled the mantra: "Advertising is salesmanship in print." At Lord & Thomas, Mr. Hopkins theorized that an ad should be built around a single selling point. He believed that if one took a product feature or quality that might be common to the industry and made the claim first, one owned it. This technique worked for Schlitz beer, Pepsodent toothpaste, Van Camp's pork and beans and Sunkist, the brand of the California Fruit Growers Exchange.
In 1911, JWT copywriter Helen Lansdowne (who later married then-JWT President Stanley Resor) added the essential emotional appeal to the sales argument with her celebrated ad for Woodbury's facial soap. The ad featured a painting of an attractive couple locked in an embrace; a provocative headline invited the audience to read further: "A skin you love to touch." The landmark ad talked about the benefits of using the product, suggesting softness, sex appeal and even romance.
The next new strategy represented a subtler approach. With a soft-sell style, the pitch revolved around conveying the impression of integrity, quality and prestige as it showcased a product in a unique selling environment. The influential book "The Psychology of Advertising" (1908) by Walter Dill Scott further justified this psychology of suggestion: Instead of scientifically describing the item, as was the practice in reason-why copy, Mr. Scott urged admakers to focus on the pleasure it would provide the purchaser.
The eloquent "Penalty of Leadership" essay ad for Cadillac, which positioned the marque as the standard for American luxury cars, established copywriter Theodore MacManus as the leader in the atmospheric soft-sell school. The ad copy opened with this memorable line, "In every field of human endeavor, he that is first must perpetually live in the white light of publicity." Many consider this image ad for Cadillac one of the all-time great advertisements. The ad, which had no illustration?and no mention of automobiles?ran only once, in The Saturday Evening Post of Jan. 2, 1915.
Another atmospheric copywriter of the time, Raymond Rubicam, used suggestive sales pitches along with lavish art and layouts to make a favorable impression. Notable campaigns from Mr. Rubicam included work for Steinway, E.R. Squibb, Rolls-Royce and the International Correspondence School.
The two schools of advertising theory, reason-why and atmospheric, coexisted for some time. The effectiveness of the style depended on the product. Reason-why worked best for small, inexpensive, frequently purchased items?such as cigarettes, toothpaste and soap-that could be offered as samples and easily sent through the mail. The soft-sell style built prestige for large, expensive items?automobiles, pianos-bought infrequently and seldom on impulse.
Agencies multiplied in size, number and services offered as the volume of advertising increased. New agencies began to offer the same services available today-planning, research, ad creation and implementation of advertising campaigns. In particular, ad preparation, education in advertising practice and market research marked key steps in the industry's development.
Beginning around 1900, correspondence schools began to offer courses in advertising technique, an indication of advertising's increased legitimization in the business world. A decade later, institutions of higher learning, including Harvard University, New York University, Boston University, Northwestern University and the University of Missouri, began to take advertising seriously enough to be studied as essential to business success. The concept of marketing research, however, was slower to be developed.
In 1912, JWT commissioned a study titled "Population & Its Distribution," which listed virtually every store by category and by state. The agency continued to update the research and began to track the growth of wholesale and retail stores in large cities.
Mail-order response testing emerged as the major form of research, providing a rough idea of ad preferences. For example, coded advertisements ran with coupons, which readers could cut out and return for information, product samples, booklets or premiums. In test cities, identical ads appeared in different magazines and the results were compared. "Split runs" compared different versions of an ad in partial pressruns of the same issue of a magazine. From these new studies, agencies identified the best medium or media for the advertising of a given product.
Professional organizations, notably the Association of National Advertisers (established in 1910) and the American Association of Advertising Agencies (1917), brought together advertisers, agents, publishers and others associated with advertising. Their efforts established standards for codes and ethics, and simplified the mechanics of advertising. Another organization, the Audit Bureau of Circulations, formed in 1914, verified which papers existed, how frequently they published, how much they charged readers to receive the publication and how large their audiences were. Participating publishers also agreed to establish uniform page and column sizes for newspapers and magazines.
Regulation of advertising
In this period, on both sides of the Atlantic, the advertising of cure-alls and health devices underwent scrutiny. In the U.S., the resulting consumer movement led to government regulation and industry efforts at self-regulation. One outcome of that was the 1906 Federal Food & Drugs Act, as well as laws requiring lists of ingredients on food containers, medicine bottles and pill boxes. Also, the activities of longtime promoters of worthless stock certificates, deceptive retail announcements and other advertising inaccuracies led to the truth in advertising movement and the formation of the National Better Business Bureau.
The situation was different in the U.K., where the government derived appreciable revenue from the trade in dubious medicinal products in the form of a stamp duty. Some manufacturers even claimed that the stamp was a guarantee of excellence.
The entry of the U.S. into World War I in 1917 provided a boost for advertising. Many manufacturers converted their production from consumer goods to war materials and others felt constrained from promoting nonessential consumer products during this time of crisis. Yet the shortages fueled an increase in the "institutional" advertising that kept company names and trademarks in the public eye.
The government created national advertising programs to gain public support for the war effort. The newly created Federal Committee of Public Information helped shape public opinion, developed wartime patriotism and told the public what they could do to help win the war. Within the committee, artist Charles Dana Gibson formed a "Division of Pictorial Publicity" that contracted with professional designers and leading illustrators to contribute their artwork to the war effort. Printers donated their services as well. After the war, the tradition of making free space available for public causes continued.
Advertising in Great Britain
As literacy spread and new media outlets opened, the modern advertising agency in Great Britain developed along the same lines as in the U.S. Several of London's large agencies date to this period, including Dorland Advertising Ltd. (1906), Pools Advertising Service & Charles F. Higman (1908) and W.S. Crawford Ltd. (1914). London-based agencies, including T.B. Browne, operated internationally, with offices in colonial and U.S. centers.
British advertisers were put on notice that to maintain their position of pre-eminence, they would have to be more solicitous toward consumers. The American Tobacco Co., for example, ran half-page newspaper ads with large pictures. Such competition stimulated British tobacco companies to run their own audits and issue trade cards.
Although there was talk of ethical issues in advertising, no code of ethics could be set up without cooperation among advertisers, which were, for the most part, individualists. Nevertheless, the Advertisers' Protection Society (later the Incorporated Society of British Advertisers) was formed in 1900.
One major obstacle to advertising response in the U.K. was the lower level of income in England compared with the U.S. In addition, the lower level of class-consciousness and greater social mobility in the U.S. gave American women social aspirations that their European counterparts did not possess. Thus, advertisers did not have such a highly receptive audience among the English working class.
During World War I, however, advertising matured in Great Britain as it had in the U.S. It fell to the government to recruit men for the armed forces, encourage women to volunteer on the domestic front, sell war bonds and promote conservation of war materials. One famous recruiting campaign featured children asking, "Daddy, what did YOU do in the Great War?" In another, women were asked whether their husband or son had "to hang his head" because they had prevented him from going off to fight. Advertising and imperialism
During the first two decades of the 20th century, the pioneering phase of international advertising networks continued, with the U.S. and Great Britain as the leading players, spreading the notion of a consumer economy to other cultures. In other countries, however, advertising did not increase in proportion to the growth in the industry.
After World War I, Canada sought to exert its independence from Britain, as foreign capital flowed in, especially from the U.S., displacing the U.K. as the chief investor in Canadian business. As general trade and manufacturing expanded, so did advertising. In contrast, Germany had not yet recovered from the war and advertising was greatly reduced. In Central European countries, advertising was not considered an essential business-building method, as it was in Great Britain and the U.S.
U.S. companies sought to capture foreign markets for their products and technologies by increasing their outlays in advertising. As a result of their willingness to penetrate regional markets in Europe and Asia, new media outlets opened to transnational as well as domestic advertisers.
Great Britain continued to dominate advertising in its dominions. In Australia, New Zealand and South Africa, the chief advertising agencies were companies based in Great Britain and the U.S.
Unlike the concerted efforts of U.S. agencies to expand internationally, Japan's Dentsu Advertising, established in 1901, operated exclusively in Asia, functioning as both an advertising shop and a news service agency.