Big guns predict smaller ad role

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The agenda coming out of AdWatch is clear: In the new order of marketing, traditional media advertising will play a smaller role.

That was the consensus at AdWatch: Outlook 2002, where executives with the smartest minds and biggest budgets said traditional advertising will be a less central component of the marketing equation as companies plot post-recession strategies.

The first annual AdWatch conference in New York, presented by Advertising Age, Taylor Nelson Sofres' CMR and UBS Warburg, drew more than 400 executives from marketing, advertising and Wall Street. While AdWatch opened with CMR's forecast of a small upturn in media ad spending (see P. 22), much of the conference buzz centered on marketing beyond traditional advertising-entertainment tie-ins, product placement, sponsorship and other ways to connect with the consumer who knows how to deflect the usual ad message.

"There seems to be almost a maelstrom of `what's next,'" said James Stengel, global marketing officer of Procter & Gamble Co. In an interview, Mr. Stengel said the consensus coming out of AdWatch is to "move the marketing to a more consumer-centric approach."

AdWatch participants agreed advertising is being upended by consolidation, new technologies and new models for advertiser-media-agency relationships. There is light at the end of the tunnel for the advertising business, they said, but those who emerge on the other side may not recognize the landscape.

`being smarter'

The rise of technology such as the commercial-zapping TiVo personal video recorder gives advertisers more need to find ways to reach consumers outside of traditional media, said speakers.

"Part of the turnaround is being more efficient and being smarter" about expenses, said Julie Roehm, director of Dodge communications at DaimlerChrysler's Chrysler Group. As TiVo becomes a factor and consumers become ever more inundated with messages, advertisers will find they don't need to spend as much on media, but need to find other ways to plan their media, she said.

Many advertisers and some media companies zeroed in on product placement in movies and TV shows as among the new hot advertising vehicles. Ted Leonsis, vice chairman of AOL Time Warner's America Online, touted AOL Time Warner's efforts inserting ad messages into movies. Steven Heyer, president of Coca-Cola Co.'s Coca-Cola Ventures, boasted of Coca-Cola's sponsorship of "American Idol," a show on News Corp.'s Fox that includes heavy on-screen presence for the flagship Coke brand. Mr. Heyer also cited the sweeping promotional deal the beverage marketer signed in June with General Electric Co.'s NBC network and the NCAA. The 11-year, $500 million deal benefits Coca-Cola since it allows for a wide selection of marketing efforts including, but not limited to, advertising on game broadcasts, Mr. Heyer said.

Multilayered, multimedia marketing packages are challenging agency-marketer relationships, speakers agreed. Not only do they require critical mass among agencies-prompting consolidation-but they challenge agencies to think past their traditional media skills, a point of debate among speakers.

Agencies have abdicated that relationship over the years by remaining focused on traditional advertising, while management consultants and other experts have emerged to offer clients strategic planning, Mr. Heyer argued (see related story,P. 22).

creative is key

Understandably, agency company CEOs in attendance disagreed. Both Publicis Groupe Chairman-CEO Maurice Levy and Martin Sorrell, group chief executive of WPP Group, scoffed at suggestions that agencies don't have strategic planning ability.

Creative ability is still key in any agency's offerings, but agencies often don't get credit for the strategic positioning work they do, said Mr. Sorrell. As an example, he noted WPP's Landor Associates is often written off as merely a creator of corporate logos when its work encompasses a range of corporate image positioning.

Meanwhile, clients are preparing for their future. P&G, the nation's No. 2 advertiser, helped set the advertising agenda on everything from radio sponsorship to Internet advertising in the 20th century, and Mr. Stengel-when he wasn't on stage presenting-stayed glued to his chair at AdWatch in search of new ideas. Advertising is "at an enormous crossroads," said P&G's marketing chief, "and yet it's not a reason to panic."

contributing: hillary chura, jon fine, lisa sanders

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