Editorial: Amid TV boom, an ROI warning

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After all the buzz created when a record $9 billion was committed to network TV in the upfront market last spring, our report in this issue on the results of a new survey of top advertisers by WPP Group's Lightspeed Research is surprising. Thirty-two percent of respondents damned network TV as the worst medium for proving return on investment. Here's a wake-up call for broadcast TV executives to quantify and justify the value of their medium. They can ill afford complacency.

Marketers are no longer slaves to network TV. There are more options available and, in this age of accountability, advertisers are even more focused on finding the most effective, and most cost-effective, media. Consider this from Bernhard Glock, manager-global media and communications at Procter & Gamble Co., the nation's No. 3 advertiser: "We know the strength of TV, and it will continue to have a very important place in our communication plans. But I see our brands becoming much more open and smarter in connecting with consumers by [other] appropriate means."

To absorb sharply higher network TV prices, advertisers are forced to move funds from other media to pay the freight-including some of those that were judged best in our Lightspeed survey at proving return-on-investment. Magazines have suffered as network TV prices rose-even though they were cited in the survey as the third-best medium for return on investment. (Notably, though, only 7% of respondents held that view).

Moreover, there's advertiser suspicion of media in general. Nearly two-thirds of respondents said media sellers are resistant to being held accountable for their work and the subsequent result on the marketer's ROI.

It's a serious mistake for network TV executives to underestimate the urgency in this. The accountability movement isn't top of mind simply because of the advertising recession. ROI is here to stay. Let the seller beware.

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