Major Marketers Push 20% of Ad Budgets Into New Media

AAF Study, Conference Demonstrate Advertisers' Feelings About Web

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LOUISVILLE, Ky. ( -- Facing a shifting media environment, major marketers are allocating up to 20% of their total ad budget for experimentation in new media, according to a survey unveiled at the recent American Advertising Federation annual meeting, where grappling with the changing marketing world was a common theme among the 750 attendees.

Marketers and media executives described several ad campaigns that achieved significant results with virtually no media spending, instead aiming limited dollars toward creative that developed web buzz.

Coffee and razors
Mary Baglivo, CEO of Saatchi & Saatchi, New York, detailed a campaign for Procter & Gamble's Folgers coffee aimed at an 18- to 24-year-old audience (well below its normal target) fashioned around the idea of how to wake up in the morning. Matt Freeman, CEO of Tribal DDB Worldwide, described a campaign for a Philips razor that would have been next to impossible to run on TV -- but it generated so much traffic that the number of razors the company hoped to sell in a year sold in six weeks.

Aldo Quevedo, president-chief creative officer at Dieste Harmel & Partners, said new media is changing how agency teams work. He said the need for interaction between campaign elements is fostering greater collaboration among traditionally separate agency partners. Ms. Baglivo said the "discussion value" of creative has been debated in every single meeting she's attended lately. Yet, while necessary, losing control of brands to consumers on the internet can be "a little scary," she said.

Jonathan Mildenhall, VP-global creative and communications for Coca-Cola, speaking at another session, said interactivity has already changed the way his company looks at creative. "We are not looking for an ad campaign. We are looking for a cultural platform around which everything we do on that brand can live," he said.

More measurement demands
Mike Kelly, president, AOL Media Networks, said the immediacy of the statistics that can be generated from web traffic are creating demands for similar accountability throughout the media industry. "The ability to measure advertising is irresistible," he said.

But it isn't just the internet that's taking away spending from paid media. Phil Lynch, VP-director of corporate communications for distiller Brown-Forman, said the company's success at using public relations to create demand for its new premium bourbon prompted his company to greatly expand its PR outreach for all its brands.

Murray Gaylord, VP-marketing for, described the web as a "sea change" for media, and Michael Maness, VP-strategy for Gannett, outlined how newspapers are participating in the movement. He said a number of local Gannett papers have had success using their websites as social networks where local moms talk to each other.

Still room for traditional
Still there were some warnings about going too far too fast with new media. Nigel Travis, president-CEO of Papa John's, said the company has been able to greatly boost its return from web efforts, but consumers wouldn't have known to seek the pizza chain out on the web if it hadn't first created brand awareness via traditional ads and direct mail.

David Verklin, CEO, Carat Americas, reiterated his warning that the "crackle of change" has become "the rumble of change" in the ad industry. "We hear it and see it every day," he said.
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