CJ Fraleigh, executive director of advertising and corporate marketing at General Motors, says many large advertising agencies lack big ideas that connect with customers. And he doesn't want to pay large increases for TV commercials whose audience is dwindling. He spoke at an advertising conference, AdWatch: Outlook 2003, on June 24 in New York. The event was sponsored by Advertising Age and TNS Media Intelligence/CMR.
The reality is that most agencies are now part of huge organizations that are more revenue models than consumer-solution models. Many people who lead these organizations are under more pressure to "hit the numbers" than to provide solutions.
The holding companies are effective at reducing cost with "back-office" efficiency. But in general, ad agencies have stopped doing consistently what icons of the industry (like David Ogilvy, Leo Burnett and Bill Bernbach) always did, which is figure out how to sell product by coming up with a big idea that emotionally connects with consumers in a creative way.
The media was a major success because it was a great facilitator of connecting product messages to consumers. People kept investing dollars because they got a good return, in terms of selling more product. When "Texaco Star Theater with Milton Berle" took off on NBC, it sold not only gasoline, but also TV sets themselves. The top shows had a 50 share - life was easy.
We all know that this simple media world is long gone as consumers have more media choices than anyone could have imagined in those days. While we as clients still love being on the Super Bowl and other top network programming, I have to step back and question the absurdity of paying double-digit increases for a dwindling audience.
The networks are maximizing some dollars in the short term, because there is less supply and greater demand - can't really blame them for that, but they're not providing business solutions as well as they once did.