The Tale Of Advertising's Fall — Rise

September 18, 2004
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GRAND RAPIDS — The Ad Club of West Michigan brought in advertising guru Steve Laughlin last week to defend his profession.

Laughlin is a founding partner of Milwaukee-based Laughlin/Constable and has done work for a who’s who of national brands, including Alka-Seltzer Plus cold medicine, Miller beers, Hillshire Farms meats, OshKosh B’Gosh clothing and local footwear manufacturer Wolverine Worldwide. He has served on the board of governors of the American Association of Advertising Agencies and has earned numerous local and national awards.

Laughlin was at the The BOB to refute the popular belief that advertising is a dying practice.

“Experts are lining up to predict our demise,” he said. “According to current conventional wisdom, there’s no reason for me to be here today, because I supposedly represent a profession without a future.”

Recent books by former Coca-Cola chief marketing officer Sergio Zeman (“The End of Advertising as We Know It”), Al Ries and Jack Trout (“Positioning”) and Al Ries alone (“The Fall of Advertising and Rise of PR”— from which Laughlin titled his program), have all predicted the exit of advertising in favor of public relations and product placement.

There is a lot of weight behind their argument. Advertising’s fate is often linked to that of mass media, and not only have networks lost their ability to efficiently reach the masses, but there are just too many channels chasing too few viewers, he said. Young men have disappeared from the traditional media landscape in favor of Internet and video games, while HBO and pay-per-view could be harbingers of the future.

Research points out that people are rebelling against the pervasiveness of commercial clutter. And that doesn’t even include services such as TiVo.

On top of that, the current cynicism toward big business, thanks to newsmakers like Enron and Martha Stewart, has eroded the confidence of the advertising message. In the dotcom era, the advertising industry took millions off the top of every IPO. When the bubble burst, ad agencies absorbed much of the blame.

“Advertising professionals are no longer the gatekeepers of brand identity,” Laughlin said. “The big enlightenment at the end of the last century was that if you understood and managed your brand, all of the other business fundamentals follow. Advertising executives lost their seat at the table to a broad array of suits.”

Laughlin said that PR is now generating the buzz. Embedding products in programming could replace commercials and maintain awareness.

“Advertising gets squeezed out,” he said. “With embedding, the line blurs between content and promotion in the media.”

Advertising critics believe the ability of PR professionals to place products and get stories written about products and companies will replace advertising.

“With the recession, we became risk averse,” Laughlin explained. “People ask what the payback is for a $2 million spot run in the Super Bowl. And I can’t tell them one, not without looking at what their brand is two years from now.”

But Laughlin believes that the cynicism toward advertising will soon pass.

“I’m optimistic about the future of advertising,” he said. “I think the media, by fragmenting away from mass audiences, will become more affordable to more brands rather than the reverse.”

Laughlin questions many of the perceived threats to advertising.

“TiVo? Who is really going to tape a show so they can watch it later without commercials? And TiVo has a $30 million advertising budget,” he said.

“And embedding is nothing new. We call them soap operas because soap companies sponsored them. The hottest new thing has been around since the start of television.

“I would say to any CEO who wants to see his or her numbers moving in the right direction to look for the story in their brands,” he added. “If told properly, it becomes a success story. It’s a story advertising has always been able to tell best.”

Critics and supporters of advertising agree that branding is the key component in many successful marketing campaigns. IPod has such a dominant brand identity that few even realize it’s an MP3 player, and that advantage translates into a sometimes tripled price. Compare Starbucks and Folgers, BMW and Mitsubishi — people don’t dream of driving Mitsubishis.

Branding is a practice in which public relations and advertising complement each other well, he said.

Laughlin cited last week’s exploits of Pontiac and Cadillac as examples. Pontiac got Oprah Winfrey to help revitalize its brand by giving cars away to everyone in the audience. That made the cover of USA Today and The Chicago Tribune. But Pontiac still ran teaser ads for its 2005 models through Sunday’s football line-up.

“Will Pontiac stop advertising? No. Cadillac ran their breakthrough campaign on Sunday too, but they’re not going to give up PR,” Laughlin said. “The truth is, it’s a big, loud, noisy world out there and we’ll need to continue to find ways to cut through the clutter and get our brands’ stories told.”    

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