Thankful For Little Things

I am thankful for the following:

• My sock draw is full.
• My dog doesn't smell too bad.
• There are no soldiers stationed in my neighborhood.
• I have some friends.
• My daughter doesn't laugh at my playlists.
• There is a really good bakery in my vicinity.
• I haven't had a cavity in five years.
• There are still some book stores left.
• Only fourteen more weeks till spring training.
• I have something to do every day.

Have a good Thanksgiving.

Be Sure To Look For This Story

Coming to your local newspaper soon will be the following all-purpose advertising story:

Advertisers Punch Up The Punch Lines To Create Some Holiday Cheer

Consumer worries over a struggling economy, layoffs, and financial uncertainty have lead a number of major advertisers to launch humorous advertising campaigns for the holiday season.

Brand X, Brand Y, and Brand Z have all begun lighthearted holiday campaigns over the past few weeks. Will they be effective?

Marketing expert Bob Hoffman says, "In times of economic crisis, consumers do not want to be reminded of the woes around them -- especially during the holidays. They want a little fun."

Now, if the economy was booming, the story would be exactly the same. Only the rationale would change.

Advertisers Punch Up The Punch Lines To Create Some Holiday Cheer

A booming economy and widespread consumer confidence have lead a number of major advertisers to launch humorous advertising campaigns for the holiday season.

Brand X, Brand Y, and Brand Z have all begun lighthearted holiday campaigns over the past few weeks. Will they be effective?

Marketing expert Bob Hoffman says, "In times of economic growth consumers are predisposed to a positive, light-hearted approach to selling -- especially during the holidays. They expect a little fun."

It Just Never Stops

The thing that makes advertising so great is that the bullshit is never-ending. There's always something alarmingly stupid to write about.

My favorite article of last week appeared in Ad Age and was entitled "Beverage Ads Not Fueling Enough Word Of Mouth."

"In 47% of conversations about brands in general, marketing or advertising is mentioned as a source of information. But only 38% of conversations about beverages include a mention of marketing or advertising."

You see, these people know precisely - to the nearest percent - what is discussed in every conversation in this great land of ours. There's no hedging -- no "about" or "as far as we can tell" or "our research indicates." They know that marketing and advertising is discussed in 47% of conversations about brands.

In my experience -- eavesdropping in public rest rooms and bugging my neighbors' telephones -- here's what I've found. I've transcribed one here for you:

Todd: Dude, what up?
Jason: Nada.
Todd: Any thoughts about like brands?
Jason: Like, brands in general or, like, beverage brands?
Todd: Uh...like...
Jason: Yeah, like, dude, Cool Ranch Doritos has this awesome like social media site except nobody knows it's like their stealth site and everyone thinks it's like so cool...
Todd: Awesome. Is that like a beverage, or what?

In my conversations about beverages, mentions of marketing and advertising occur 0% of the time. 100% of the time the conversation is..."make it a double."

Why "MadMen" Lived In Barbie Dream Houses And You Live In A Shit Dump

This is the third part of "How Ad Agencies Make Money". The first two parts are here and here.

Advertising used to be a lucrative profession.

The traditional economic model for an ad agency was this: an agency's goal was to have revenue equal 15% of billings, and profit equal 20% of revenue.

So, on a hypothetical account with billings of a million dollars, the old "MadMen" financial model looked like this.

Billings: $1,000,000
Revenue: $150,000
Profit: $30,000

There was additional money to be made on other services like production mark-ups and mechanical preparation.

Today's world is way more complex and way more daunting. I haven't seen AAAA's figures recently, but I'll bet for most agencies revenue is down around 10-12% of billings and profit is 7 - 10% of revenue. It's hard to compare the old ratios to the new because so few agencies buy media anymore.

If I'm right, however, the average agency is probably making about $10,000 in profit annually on $1,000,000 of billings. You can make more money on a savings account.

I'm not bemoaning the lack of corporate profits here. What I'm talking about is that companies that can't make decent money also can't pay very well or hire very much. And if you think publicly traded companies are going to forgo their profits to pay more, you're dreaming.

Salaries consume 50-60% of agency revenue. Far greater than any other expense. When times get tough, agencies have 2 options: pay lower salaries or employ fewer people.

When I started in the business, agencies used to have, on average, 4 people per million dollars of billings. Today they have less than one person per million. This is why so many agencies have become sweat shops.

My former partner used to say that clients won't be happy till we have zero people per million.

The difficulty in making money helps explain why so many independent agencies have disappeared. Every ten years or so the agency business turns sour. When it does, independent shops don't have cash reserves like the big guys, and it's hard for them to survive.

The big global agencies will endure the next few years. But it's going to be tough for agency employees and independent shops. Take a deep breath and fasten your seat belt.

5 Good Things About The Coming Depression

You know me, always looking on the bright side.

So while the world comes crashing down around us, I thought I'd make a list of 5 potentially good things about the coming years of deprivation and misery.

• No more fucking crème fraîche. With any luck all the bullshit restaurants will close down and we'll be able to get back to eating good stuff like grilled cheese and spaghetti and meatballs.

• No more designer jeans. If there's any justice in the world, the nitwits who paid $300 for torn denim will need the cash to buy food.

• No more water from Fiji. You know that bottle of water you paid $5.50 for in your hotel room? Well, that shit is free right in the bathroom. I'm not kidding.

• Maybe Verizon will go out of business. And we won't have to look at that putz anymore.

• End of global warming. All those people who've been saying the only way to stop global warming is to change our profligate ways? We'll soon find out if they're right.

That's Right...
...I said depression, not recession.

Tomorrow:
How Ad Agencies Make Money, Part 3:
"Why MadMen Lived In Barbie Dream Houses And You Live In A Shit Dump."

The 3 Numbers You Have To Know

How Ad Agencies Make Money, Part 2.

Yesterday we started a series on the economics of the ad business. It's not meant to be in-depth or technical, but just a simple overview for non-financial types.

I am constantly amazed that people who've worked in the agency business for 10 years or more have no idea of the economics of the business. They've heard all the terms but are not really sure what they mean.

Most people who work in agencies would probably be shocked to learn that today the average ad agency is lucky if it can make 10 thousand dollars in profit on a million dollar account.

So before you and your pals decide to quit your jobs, have your moms sew some costumes, and open up an agency, you better get a handle on how the money part works.

Today we're going to define our terms for the three key numbers.

First is billings.

Billings: It's the number that the trade press is obsessed with and agencies lie their asses off about. Yet to smart people, it's the least important of the three numbers.

Billings is the total amount of a client's money that passes through an agency. If you think of billings as the client's total ad budget you won't be far off. It might include the media budget, production budget, agency fees, etc.

Next is revenue. It's sometimes called "gross income."

Revenue: It's the amount of money the the agency actually gets to keep. Most (90% or more is not unusual) of the billings dollars get passed through the agency to someone else (tv networks, production companies, printers, etc.) In other words, billings tell you nothing about how much an agency is making. It only tells you about how much it is touching. Revenue (or gross income) tells you how much it actually gets to keep.

Revenue may come in the form of fees, commissions, mark-up, hourly charges, etc.

Finally there's profit. To agency managers, this is the number that really matters.

Profit is revenue minus expenses. In other words, how much money is left after all the bills have been paid.

One of the huge misconceptions about the agency business is that large billings are always a sign of economic health. It is nothing of the sort. If you refer to the economic history of Interpublic Group (IPG; it owns McCann, Deutsch, HillHoliday, etc) you can see how an agency with billions in billings can lose money.

A small 3-woman shop in Toledo, on the other hand, with a few hundred thousand dollars in billings can be more profitable than IPG.

Later this week we'll put these numbers together and see why the ad business has become such a piece of shit.

Proud To Be...
...the only ad blogger in the universe who hasn't blogged about the Motrin mess.

Assholes:
The arrogance and stupidity of big corporation ceo's is beyond belief. Here's a tip: Before you go begging for 25 billion, sell your fucking private jet.

How Ad Agencies Make Money

Part 1.

Okay, you're sitting in your cubicle and you're thinking, "why the hell do I care how ad agencies make money?" Here's why:

• So you won't sound like an idiot when you talk to grown-ups.

• Do you really want to work for these morons the rest of your life? If not, you need to know more than how to load the toner cartridge.
  

The reason for this post is that I read an advertising blog the other day and it was clear to me that the blogger had no clue how agencies make money.

So I thought -- as a public service -- I'd do a little series on the economics of the ad business. But don't be frightened. I'll make it so simple even an account planner can understand it. Art directors I can't guarantee.

Here's an outline of what the series will look like:

Part 1: Intro (That's this bullshit you're reading now.)
Part 2: The Three Numbers You Have To Know
Part 3: Why "MadMen" Lived In Barbie Dream Houses And You Live In A Shit Dump.
Part 4: All Advertising Bloggers Are Idiots.

I reserve the right to change this as we go along.

Okay, so your first assignment is to read this and later in the series we'll talk about why the guy who wrote it doesn't know what the hell he's talking about.

Asterisk:
Someone must have dick-slapped the guy who wrote the article I "assigned" because he has since disclaimed his initial mistake. But read the article anyway and we'll talk.

Update:
Also read this piece by the same guy. Same problem. We'll talk about it later this week.

Tomorrow:
Part 2: The Three Numbers You Have To Know

Spreading The Manure

A few weeks ago I wrote a post called "The Smear Machine."

It was a reaction to bloggers who had written that the web will diminish the effect of political smears and lies that are spread during campaigns by quickly exposing them.

I believe the opposite. In the post I said, "the internet has proven to be a far better medium for spreading nonsense than for exposing it."

One week later, a story appeared in mainstream media (first, FoxNews then MSNBC, The LA Times, and the New Republic) -- and all over the internet -- that Sarah Palin thought Africa was a country, not a continent.

In short order, MSNBC attributed the story to a McCain campaign staffer named Martin Eisenstadt, senior fellow at the Harding Institute for Freedom and Democracy.

Only trouble is, Martin Eisenstadt doesn't exist and neither does the Harding Institute. In fact. Eisenstadt is a hoax that has been feeding the news media bogus election stories for months.

Fox (the source of the story) still maintains the story is true. They say it's just MSNBC's attribution that was false. We'll see. I can't say I have a whole lot of confidence in Fox news.

The New York Times reported:

...(the Eisenstadt hoaxers) say the blame lies not with them but with shoddiness in the traditional news media and especially the blogosphere.

The story is made even more disturbing by the following facts:

• Remember when the McCain campaign compared Obama to Paris Hilton (celebrities famous for nothing?) Eisenstadt's phony blog claimed that relatives of Paris Hilton had called the McCain campaign to complain. The LA Times political blog reported the story and linked to Eisenstadt.

• Eisenstadt's phony blog contended a few weeks ago that Joe The Plumber was related to Charles Keating, of the 80's saving and loan scandal. That, too, was a hoax but tons of bloggers, (including Fame Crawler and Daily Kos) reported it.
  

• Robert J. Elisberg of The Huffington Post wrote: "You see, Joe Wurzelbacher is apparently related to Robert Wurzelbacher. Who is the son-in-law of (are you ready...?) Charles Keating!" Oddly, the piece by Mr. Elisberg seems to have disappeared from The Huffington Post. At least, I can't find it. Ironically, it was a Huffington Post piece about how the internet was the remedy to smears, lies, and hoaxes that motivated The Smear Machine in the first place.
  

Anyone who thinks the web is an antidote to smears, lies and hoaxes is delusional.

The web is not the solution. To an ever-increasing degree, it's the problem.

Not All Contrarians Are Idiots:
Check this out*

Note To Seth:
Enough already with the tribes.

* Shout out to Mark Schaeffer for the Peter Schiff video.

Nader Wins Dance Poll!

View the moves that swept Ralph Nader to victory.



Final Results:
AdBroad 13%
George Parker (AdScam) 6%
David Burn (AdPulp) 7% (despite massive get-out-the-vote campaign!)
Steve Hall (AdRants) 9%
Alan Wolk (The Toad Stool) 9%
AdContrarian 27%
Ralph Nader 30%

Take My Poll, Please

I was surfin' the old interweb the other evening and I came upon a poll. I have no idea what the poll was about, but it was designed so nicely that I immediately wanted a poll myself.

So I went to PollDaddy, the source of said poll, and found that I could have an awesome poll just like the one I saw for FREE! Couldn't pass that up.

The only trouble was, I didn't have anything I wanted to have a poll about. (You see, secretly I don't give a shit about what anyone thinks. Promise not to tell?)

So I sat around for a while and thought, what can I have a poll about? First I thought "why not take a poll about what kind of poll I should have?" which I thought was a pretty funny idea.

Then I realized -- yes! -- there is something really important that has been ignored by the ad blogging community and we need to get it out in the open.

So please take this poll. And remember, voting is not just a right. It's a responsibility.

I Don't Like It

Back when I was a creative director I always used to get into arguments with copywriters and art directors. They'd show me something and I'd say, "I don't like it."

Then we'd debate whether it was okay for me to kill an idea just because I didn't like it, or whether I needed a reason for not liking it.

I was reminded of this last week when I read a piece in Adweek called "Why Do Clients Deserve The Advertising They Get?" In the piece, the author says...

'It's hard to approve advertising you don't love. But if you must, at least give more of a reason than "I don't like it." That is unactionable feedback... That almost always leads to mediocre advertising.'

I couldn't disagree more.

Some ideas just suck; some are ugly; some are stupid; some are just not up to the taste level you aspire to.

As a creative director your responsibility is not just to compare the ads to the brief. Your job is to bring some type of aesthetic sensibility to the work as well. Aesthetics aren't about reasons, they're about taste and opinions.

I was a copywriter and I understand that hearing the words "I just don't like it" may not be the most satisfying criticism. Nonetheless, it's often the most appropriate and the most honest.

And Now For Something Completely Different...
I often (maybe too often) write about the baloney and deception that passes for research in the digital advertising realm, especially among those who have a vested interest in promoting it. It's nice to know that there are some in this realm that aren't full of shit and are eager to look at the facts with an open mind.

Dopey Digital Diva Dumbness

Today's sermon is about a story in Ad Age called "Wired Women an Untapped Goldmine for Package Goods." The thrust of the story is that package-goods marketers are missing out on a huge bonanza by not spending money to reach "digital divas" on line.

Apparently MicroSoft, MindShare and Ogilvy teamed up to convince gullible package-goods clients to piss away money on social marketing and other online ad nonsense. Here are some gems from the story, along with comments from yours truly.

Long ago...package-goods marketers largely concluded that women didn't want to spend much time talking about their low-involvement products or buying them online...How wrong they were....some 16% of U.S. women... actually do.

Which means 84% don't.

And what exactly are the 16% doing? "Talking about" or "buying" or what? And just for the heck of it, why not tell us how often the 16% do whatever they're doing. Once a week? Once a year? Twice in a lifetime?

"There are women we found who actually have standing orders with Amazon for their toilet paper," said Beth Uyenco, global research director at Microsoft.

Hey, global research director, there are people who wipe their ass with Rice Krispie Treats. What the hell does that have to do with spending marketing dollars intelligently?

"The researchers found that women speak or write 7,000 words daily compared with 2,000 for men...That extra 5,000 words a day can be spent on the digital space talking themselves into loving your brand"

Sure, and they like music so they can do interpretive dances about your brand.

Just a reminder to those who don't keep up with TAC -- and those who can't distinguish between research and bullshit -- here's the real truth about advertising to women on line, from a Global Advertising Study done by AOL:

"Ninety-nine percent of Web users do not click on ads on a monthly basis. Of the 1% that do, most only click once a month. Less than two tenths of one percent click more often.

Who are these "heavy clickers"? They are predominantly female, indexing at a rate almost double the male population. They are older. They are predominantly Midwesterners...they look at sweepstakes far more than any other kind of content..."

In other words, as brilliant commenter Timothy Coote wrote recently, these fabulous digital divas that represent an untapped goldmine are "the people who think they really are the one-millionth customer."



Full Feed Vs Short Feed
Several readers have asked me to publish the full RSS feed of this blog instead of the short version. I tried it for one day and I don't like it. Here's why. I'm a little obsessive. I'll often change a word or phrase during the course of a day. Some days I'll do it a lot. I don't know how RSS works, but I notice that the changes don't appear very quickly, if at all, on the full feed. They appear instantaneously on the blog.

So click one more time and come to the real blog. The exercise will do you good..

The Real Real Story

Anyone who's had the pleasure of dealing with the press knows the game they play.

They call you and ask for a comment. In about 30 seconds you can tell what the angle of the story is going to be and what they want you to say. If your comment doesn't agree with the predetermined assumptions of their story they'll either...

• Ask another question
• Keep pumping you until you say something that sounds like it confirms their preconception
  
• Not print your comment

Here's an example. The narrative (I hate that fucking word) in the advertising press these days is that traditional media is dead and digital media is king. It doesn't matter how much the facts belie this, they are chained to it.

Some facts:

• In the recent election, candidates spent over 2 billion dollars on tv and radio ads.
• They spent less than 18 million on online ads
• Proportion of spending on traditional media: .992
• Proportion of spending on digital media: .008

So what was the story in MediaWeek? You guessed it. It was about how lousy the election was for tv spending and how fabulous it was for online spending. This is a quote from the story:

"Overall, this was a disappointing election for TV"...said Kip Cassino, vp of research for Borrell (Associates)...The real story, said Cassino, is online spending...

The real "real story" is online spending all right -- and how there wasn't any.

But don't expect to hear that from the imbeciles of the trade press or the bullshit "vps of research" with axes to grind.

They have a story they want to tell and they're going to tell it whether it's true or not.



These People Are Wonderful:
It is our practice here at TAC to acknowledge the charming and brilliant bloggers who have had nice things to say about us recently. So thanks to: David Burn, Rhetoric69, Tim Coote, Elliot Stearns, Chris Waters, Matt Jones and Tanya Burek. Please patronize our supporters.

I Made Out With Julia Louis-Dreyfus

It's true. And, to be honest, it wasn't all that great.

Here's what happened. The other night I dreamed that Julia and I were working together. It wasn't clear what we were working on, but it was definitely something very creative.

After work we headed home. I walked with her to someplace like the NYC subway. It was like the NYC subway in the sense that it was a public transportation site. It was unlike the NYC subway in the sense that it didn't smell like cat piss and I didn't feel like my life was in danger.

But I digress...

On the way we talked. We soon confessed our love for one another.

I asked her, Julia, how can someone like you be in love with someone like me? Bob, she said, you're the most interesting, fascinating, funniest guy I have ever met! But Julia, I said, you've worked with Jerry, and George, and Kramer, and internationally handsome movie stars. She just smiled and looked at me adoringly.

Julia told me that she was married and I, likewise, explained the same. We quickly realized, however, that this was a Great Romance and was not subject to the normal, bourgeois rules of sexual behavior. We began to make out.

Now here's the upsetting part.

When we kissed, she made ducky lips. It's hard to explain ducky lips, but if you were here I could show you. You sort of, like, flex your lips and look like a Simpson.

It's not easy trying to kiss someone who's doing that. As a matter of fact, it's kind of alarming.

Julia and I learned a very important lesson that night -- even a Great Romance can't survive something like ducky lips.

By the way, I was terrific.

Washington Post Admits Bias

In a post last week, TAC excoriated the press for its bias toward Barack Obama during the presidential campaign.

Several commenters took me to task.

Today, however The Washington Post admitted its bias. Their ombudsman, Deborah Howell, had this to say...

"...readers have been consistently critical of ... what they saw as a tilt toward Democrat Barack Obama. My surveys, which ended on Election Day, show that they are right..."

Just one little thing, Deborah, where the fuck were you for the past two years?

TAC voted for Obama and is happy he won. That doesn't make me any less disgusted with the dangerous game the press played.

One of the subtle ways the press gets us to think their way is with photo editing. Think of all the unflattering photos you've seen of John and Cindy McCain. Can you recall one unflattering photo of Barack or Michelle Obama?

I can't.

Will The Recession Help TV?

We conclude "Recession Week" today with two guest posts. The first is by Susan Bandura.

Now that even The Wall Street Journal has admitted we are in a recession, everyone has run amok with dire predictions about marketing and advertising.

The online world remains relatively upbeat, knowing that the Internet is still attracting plenty of viewers, and that online advertising is way cheaper than more traditional media.

But most pundits are saying that TV advertising is more vulnerable than ever – that companies are going to cut their TV advertising budgets, that DVR penetration is going to help put the nail in the coffin.

But what’s really going to happen to TV viewing in the near future?

Let’s see … everybody has a TV … people are staying at home more … consumption of entertainment usually goes up when the economy is down… and now it's dark by the time we get home from work...

All of these factors say “more TV watching” as far as I’m concerned. Which means that TV advertising will make as much – if not more – sense than ever.

In A Recession, Protect Your Customers

Today's second guest post is by James Hipkin.

Retaining customers is always important. But, in a recession, it is vital.

The tendency when times are tough is to focus on acquisition. Acquisition is important. But focusing on customer retention is less expensive and will have a greater short-term impact on your business. Small increases in loyalty (or attrition) will have significant impact on your bottom line.

Retained customers have the following benefits over newly acquired customers.:

• You don't need to bribe them. They have paid full price in the past and are prepared to continue to do so. They are loyal because they see value in your products or services.
  

• They are more likely to respond to up-sell and cross-sell offers. Because they have a relationship with your brand, they are easier to convert.

• They cost less to service. They know how your products work and don't need to contact customer service or sales as frequently.

• They can be advocates for your products. Especially when times are tough, consumers want to make purchase decisions with confidence. Nothing builds confidence like a personal recommendation from a peer they trust.

Keeping customers loyal is the most efficient marketing activity you can pursue. This is especially true for the category heavy users who are your best customers. As Sharon Krinsky explained in her piece Good Strategy For Bad Times, advertising should be designed to appeal to high yield customers.

Your smartest competitors will be targeting your best customers. You need to protect them. For specific ideas on how to do this, click here.

Remember, no matter how well you do everything else, you can't make money without customers.

James is director of Link, the digital and direct response arm of Hoffman/Lewis. You can reach him at jhipkin@linksf.com

Susan is director of strategic planning at Hoffman/Lewis. You can reach her at sbandura@hoffmanlewis.com.

Hard-Time Lessons From Grandpa Red

It's "Recession Week" here at TAC. I've asked some of my colleagues to give us their thoughts about advertising during a recession.

Today's guest post is by Jimmy Cabral.

My grandfather prepared me for a recession. Grandpa Red grew up in an orphanage in Healdsburg, CA. Times were tough and his mother couldn’t afford to take care of him.

He worked hard his whole life and appreciated the money he earned. Later, when he married and raised four children, those tough times never seemed to leave him.

He had everything he needed and, once in a while, he’d get something he wanted. He was the type of person that always bought quality -- but it was the most basic model of quality. His cars were well used, but always meticulously taken care of. He always knew who had the lowest price on the stuff he needed.

He'd clip a coupon. In fact, he had a coupon drawer. He didn’t like cheap though. He’d walk in anywhere and bargain with anyone. He’d pay what he thought was fair, or he’d walk out.

I remember once when he got a new TV our whole family was certain that Grandpa Red got the best deal available. And he was proud to let you know it.

Some thoughts about Grandpa red:

• He didn’t need or care about the latest unnecessary features.
• He wasn’t cheap, he appreciated value.
• He used and reused every bit of everything he bought.
• He watched prices and he’d wait for the best one.
• He was a brand loyalist. All of his tools were Craftsman. In his mind, compromising on quality was not an option.
• He didn't buy anything he didn't need.
• None of this interfered with his happiness.

I think you're going to meet a lot of Grandpa Reds in the next year. You might want to get to know him.

Jimmy Cabral is group creative director at Hoffman/Lewis. You can reach him at jcabral@hoffmanlewis.com.

Dangers Of A Biased Press

I voted for Barack Obama and I'm glad he won. I hope he becomes a great president. Lord knows we need one.

Now the bad news. I've been thoroughly disgusted by press bias in his favor.

As someone who is a "communications professional," I have a healthy regard for the difference between what I do in advertising -- advocacy -- and what the press is supposed to do -- report facts.

Press favoritism has reached an outrageous and dangerous point in this country.

It was clear from the day he started running that the press was in Obama's pocket. Anyone who couldn't see that is either a fool or didn't want to see it. I've included some links below but for those who just want the topline:

• By 8 to 1 Americans think the press wanted Obama to win.
• In the last months of the campaign, the press carried three times as many negative stories about McCain as about Obama.

I have every reason to believe that Obama is an honorable man. But what if the press decides to adopt someone who isn't honorable? The fact that they rolled over for my guy gives me no solace at all.

We are living in a nasty, troubled world and we need the best press we can get. Instead, we have a bunch of arrogant, snotty, know-it-alls who believe we need their advice on how to think. They are tough on the people they don't like and fawn on the people they do.

I have no use for the self-righteous, god-botherers of the Republican right. But they're dead right about one thing -- the "media elite" in this country are a fucking disgrace.

Some links:

• Washington Post here: "Coverage of McCain Much More Negative Than That of Obama".
• Pew Research Center here: 8 to1, Americans think press favored Obama.
• Founder of Harvard Media Center and Democratic Fundraiser here: “I am absolutely outraged with the media coverage of the presidential campaign.”
• ABC News here: Opinion piece by disgusted reporter.

Good Strategy For Bad Times

This guest post is by Sharon Krinsky. Yesterday, Sharon described the three types of businesses and how the wisdom of advertising during recessionary periods was different for each. Today she talks about creative and media strategy for a recession.

During difficult times it's more important than ever to be practical and realistic about what you're trying to achieve by spending money on advertising. We have certain principles we guide our company by (you can find them in Bob's book, The Ad Contrarian.) Two are particularly relevant in times like these:

• First, create advertising that is focused on changing behavior, not attitudes.

Contrary to what most people think, behavior is easier to change than attitudes. It is easier to convince you to eat a Big Mac than convince you that a Big Mac is a good thing to eat. It is easier to convince you to go to Las Vegas than to convince you that going to Las Vegas is a smart thing to do.

Trying to change attitudes is a difficult and expensive proposition under the best of circumstances, and this ain't them. For the time being, ignore your agency’s brand babble and focus on giving your customer a practical reason to try you now. (By the way, getting them to try your product is the best way to build your brand, but that's another story.)

Give her a good reason to change her behavior. She will respond to a good deal; a service enhancement; a special offer; meaningful product differentiation; innovations; new benefits, etc.

• Second, target the heavy user (high-yield customer) in your category.

For example, in the fast food category, one-third of the customers account for between 70 and 80% of sales volume. In many categories the same is true.

Now is the time to go after this heavy-using, high-yield customer. Economic conditions are causing them to re-think their habits. They are willing to reconsider entrenched brand loyalties.

You have a unique opportunity to get them to give you a try. Find out who they are, and design your advertising to appeal to them.

Advertising during tough economic times is not for the timid. You’re going to be asked a lot of difficult questions by those in your company. However, if you have a good reason to advertise, and a clear, sensible and practical strategy, advertising can be a major asset in seeing you through these times.

Sharon is president of Hoffman/Lewis, San Francisco and St. Louis. You can reach her at skrinsky@hoffmanlewis.com

Advertising In A Recession: Yes or No?

It's "Recession Week" here at TAC. I've asked some of my colleagues to give us their thoughts about advertising during a recession. Today's guest post is by Sharon Krinsky.

Whenever there’s a serious economic downturn there are always two knee-jerk reactions:

1. Advertisers cut their ad budgets.
2. Ad executives say they shouldn’t.

Who’s right? Well, that depends on who you are.

In order to have an intelligent advertising strategy during a recessionary period, you need to understand that there are basically three kinds of businesses:

• Businesses for whom advertising is essential.
• Businesses for whom advertising is discretionary.
• Businesses that are somewhere in the middle.

Today we'll take an overview of each type of business and the advertising issues it faces. Tomorrow we'll get into specifics.

Businesses for whom advertising is essential.

For some companies, advertising is oxygen. With it, they grow. Without it, they die.

These businesses tend to be in categories that are consumer-oriented and highly responsive to marketing activity. They include fast food, retail, consumer packaged goods, and automotive.

If you are in one of these categories, or a similar category, trying to save money by dramatically cutting advertising will do more harm than good. If you have a successful advertising campaign in progress, you should stay the course in terms of spending and message.

However, if you're in a category like this and your current advertising efforts are not showing success, you need to keep advertising but change your strategy. How?

Create advertising that is focused on changing customer behavior, not customer attitudes.

A lot more about this tomorrow.

Businesses for whom advertising is discretionary.

There are some types of businesses that are not highly responsive to advertising: life insurance, wine, and serious technology are a few examples.

These businesses generally use advertising for secondary purposes like influencing investors, impressing the trade, softening you up for the sales call or, frankly, assuaging corporate egos (hard to believe, huh?) Advertising may be useful, but is not essential to the business.

If you are in one of these categories, and revenue is starting to sag, saving advertising dollars is a good idea. If you go dark for a few months the only ones who’ll notice will be your ad agency.

Businesses that are somewhere in the middle.

Most businesses are somewhere in the middle. Advertising is sometimes successful, sometimes essential, and sometimes unnecessary or ineffectual.

If you are in one of these businesses you can do yourself a lot of good, or a lot of harm. It all depends on whether you're using creative and media strategies that are appropriate for the times. What you did last year may not be a good model and needs to be reconsidered with a sober eye.

To get some specific ideas on how to build your creative and media strategies, part 2 is here.

Sharon is president of Hoffman/Lewis. You can reach her at skrinsky@hoffmanlewis.com

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