Agency life

 

By the Golden Age of Advertising in the 1950s, agencies had developed well beyond the space broker role. A “full service” agency typically has four departments.

 

Account service people are typical “suits,” businesspersons who spend their days interacting with clients. The job here differs little from any other high-dollar, long-term sales position.

 

Of course with a lot of money at stake, few clients are willing to okay an ad based solely on a “we think this will work” from the agency. The research department is involved at every step of the advertising process. Early in development, research pros figure out who’s in the target audience, the consumers most likely to buy the product. Then when the creative folks come up with ideas, research does tests to determine how the audience is likely to respond.

 

Everyone else at the agency secretly or openly resents the creative department, because the folks who write and design ads often don’t seem like they work for a living. Creativity sometimes comes from strange sources. For example, if the writers and artists are trying to come up with a pirate-themed ad for fast food, they might spend a day watching all the Pirates of the Caribbean movies back-to-back in order to “get into the pirate mind-set.” But despite their apparent laziness, good creative people are crucial to the ad business. The quality of the creative work is the difference between bad ads and good ads and between good ads and great ads.

 

Once an ad has been created, research proves that it will work and the account service folks get the client to give the okay, the media department goes to work. Strategic planners determine where and when the ad needs to run, and media buyers get on the phone (or start sending email) to purchase the print space and broadcast time for the ads to run.

 

 

The right people and the right message

 

The key to successful advertising is the precise targeting of audiences. Few if any products or services appeal equally and universally to all consumers. Some targeting is the natural byproduct of the nature of the product. Thus tampon ads target women between 13 and 50. Other targeting is dictated by more complex social factors. Though there’s no particular reason why women can’t drink beer, most beer ads are aimed at men.

 

Although media companies like to boast about their overall audience sizes, advertisers and ad agencies are usually a lot more interested in just the audience members they’re targeting. This provides the finances for narrowcasting in the television industry and related practices elsewhere in the infoscape.

 

This also affects the ad agency’s math a bit. When buying TV ads, value is calculated by cost per ratings point. Even an expensive ad is still a good deal if the show has a high rating. That’s why popular shows make money for their networks and unpopular shows get canceled.

 

Unless, of course, a smaller audience somehow appeals to advertisers. Usually when we talk about “ratings,” what we mean is Gross Ratings Points (the percentage of an overall market). But ad agencies often pay more attention to Target Ratings Points (the percentage of a subset of the overall market). If you’re trying to sell the new model year Mercedes line, you don’t care about all of America anywhere near as much as you care about people who live in neighborhoods where the average family may be in the market for a new luxury car.

 

 

Viral marketing

 

The 21st century infoscape is a cluttered world. We get our news from a dozen web sites rather than one newspaper. We get our entertainment from 300 TV channels rather than just three. We also have many time-spending options that don’t include traditional advertising. As more and more advertisers enter the market, it becomes more and more difficult for any one voice to get our attentions amid the constant barrage of noise.

 

Clutterbusting is thus the key to 21st century ad success. One way to bust through the clutter and get consumers’ attention is to be bigger and better at traditional advertising. You can either come up with a particularly brilliant message – an ad that’s funny or thought-provoking enough to get people to voluntarily watch it – or spend so much on ad placement that your message becomes difficult to ignore.

 

Advertisers with smaller budgets (or even big companies looking to save money) more and more frequently resort to viral marketing. Rather than pay for a traditional ad, these companies find ways to sneak their products under our clutter-screening radar.

 

This concept actually isn’t entirely new. For many years companies have been paying Hollywood filmmakers to include their products in movies. The next time you watch a big-budget movie with a contemporary setting, keep an eye out for products and logos displayed so conspicuously that they’re easy to notice.

 

The advent of the Web as a mass medium has provided tons of new viral marketing opportunities. Indeed, the term “viral” itself comes from the tendency of some videos on YouTube to draw large numbers of viewers despite the absence of promotion by their producers.

 

Such an environment is perfect for ads. If a company can come up with something entertaining enough that people will watch it voluntarily, that’s a double kill. First, the company doesn’t have to pay anything beyond the initial production cost (which in many cases is quite low). And better yet, people are actually watching the video rather than ignoring it as just another part of an ad break.

 

 

Measuring success

 

At least one of the great gurus of the ad industry defined a successful ad as anything the client agrees to pay for. Of course that’s a little short-sighted, as a client might approve something that wasn’t any good and didn’t promote sales, thus running the client (and eventually the agency) out of business. But how then should success be measured?

 

From the agency’s perspective, they’re doing their jobs if the ad appeals to the target audience. The creative people come up with a message to which potential consumers respond positively, and media planners make sure the message gets out to the right parts of the marketplace. Mission accomplished. But if sales don’t go up, this “successful” ad campaign isn’t much good to the company that paid for it.

 

On the other hand, using increased sales as a standard isn’t necessarily fair to the agency. Advertising is only part of the overall marketing mix, and fatal problems can crop up at any stage of the game. No matter how brilliant it might be, no ad campaign in the world is going to sell a new brand of soda if consumers think the stuff tastes terrible.

 

Further, even traditional billing methods break down in many of the new media. An agency that charges clients a commission based on ad sales won’t be making much money off a viral marketing campaign in which placing the ad doesn’t cost a penny.

 

 

Advertising and the law

 

Many people sincerely believe that an agency of the government actively polices the marketing world to protect consumers from “false advertising.” Some folks – including several textbook authors – also think that the First Amendment doesn’t protect advertising. Wrong on both counts.

 

To be sure, the Federal Trade Commission does have some authority over ad practices. If an ad is part of a dishonest business practice such as a bait-and-switch operation, then the ad becomes part of the government’s case against the crooked business. But legitimate companies have a lot of leeway to exercise “relevant hyperbole” in ads. If a newspaper plug for a restaurant offers potential customers “the world’s best cup of coffee,” the government can’t make the restaurant prove that its coffee took first place in an international competition against every other cup of coffee in the world.

 

Further, many consumer advocates argue that the FTC’s enforcement authority lacks teeth. The commission can’t come charging in and order an immediate halt to anything it thinks is fishy. Investigation of false advertising claims can take some time. Given that even popular ads have an average message life of only six months or so, the offending message is frequently gone before the government can act. Punishments are also weak, typically involving consent decrees in which the company merely promises not to run the ad anymore. So enforcement affects advertisers only in cases of extreme, long-term abuse.

 

For more than a century after the First Amendment became part of the Constitution, many legal scholars assumed that its protection for free speech extended only to political messages, which of course are essential to democracy. Starting in the middle of the 20th century, however, the Supreme Court began extending the definition of “speech” to a much broader realm of communication. In a case involving Virginia’s restriction on pharmacy ads, the court recognized that a lot of people care far less about what politicians have to say than they do about how much a bottle of aspirin costs. Thus the First Amendment protected not just political speech but commercial speech as well.

 

 

The birth of PR

 

If this section was set up with the structure from the media chapters, then the realm of public relations would have three “key players.” The idea of trying to maintain a positive popular image isn’t new. Even Alexander the Great worked hard to win support back home in Macedonia as well as among the people he conquered. However, modern PR begins in the Age of Trusts at the end of the 19th century.

 

John D. Rockefeller, the wealthy owner of the Standard Oil monopoly, employed a man named Ivy Lee (known as “Poison Ivy” by those who opposed Rockefeller). Traditionally, monopolies didn’t bother themselves much with caring about what the public thought of them. After all, if you need gas and only one company sells it, even if you hate that company you have to do business with it anyway.

 

Lee came up with the idea that it was better to openly cooperate with the media than to stonewall them. Stonewalling might prevent some bad press in the short term. But it doesn’t give you much control over public perception. By working with rather than against reporters, Lee gave Standard a lot more control over how the company was viewed by consumers.

 

Though Lee first came up with the idea of public relations, Edward Bernays really made it work. The nephew of Sigmund Freud, Bernays applied psychological principles to his PR tactics. One of his most legendary victories increased cigarette sales by associating smoking with feminism. Observing that half the human race was excluded from cigarettes’ target audience by social mores that prevented women from smoking in public, Bernays’s strategy was to convince suffragists – campaigners for women’s right to vote – that the right to smoke was also a key step in liberation from male oppression. Though he didn’t exactly practice what he preached – Bernays was a notorious sexist – his campaign nonetheless dramatically increased tobacco sales.

 

Of all the PR geniuses, the most famous is probably P.T. Barnum. Barnum’s client was himself, or more precisely his various circuses, side shows and other attractions. The Cardiff Giant affair demonstrates typical Barnum tactics. A couple of con artists paid a sculptor to create what looked like the body of a large man. Then they buried it a field, left it for awhile, dug it back up and claimed to have found a “fossilized giant.” Of course the claim was absurd on several levels, but that didn’t seem to hurt the giant’s popularity. People lined up for blocks to see it.

 

Seeing the sales potential, Barnum offered the giant’s owners a substantial sum for their creation. When they refused to sell, Barnum wasn’t daunted in the slightest. He paid another sculptor to make him his own Cardiff Giant. Then he started marketing it as the original. Though you won’t find Barnum in any ethics textbooks – unless he’s a “don’t do this” example – his legendary observation that “There’s a sucker born every minute” (whether or not he actually said it) made him a wealthy man.

 

 

The PR profession

 

“Public relations” is a less clear-cut term than “advertising.” Ad people work with ads. Public relations people work with the public, and that involves a much wider variety of jobs.

 

Most large and even mid-sized companies have “in house” PR departments (something to consider if you’re trying to decide between the agency-centered world of advertising and the broader employment opportunities of PR). And of course different companies will have different PR needs. My own experience doing public relations for a university involved a lot of press releases and newsletter generation. The entire time I worked there, I didn’t organize a single news conference. The folks right across the parking lot who worked for the university’s athletics programs, on the other hand, put together news conferences all the time.

 

The definition of “public” also varies considerably, frequently focusing on specific groups rather than everyone at once. Lobbyists are PR people who work exclusively to advance their employer’s interests among members of the government. And many of the best-paying PR jobs are in investor relations, dealing with people who own (or might buy) stock in the company.

 

If companies never developed image problems, PR people would have really easy jobs. On the other hand, if companies never developed image problems then PR people probably wouldn’t be necessary.

 

Some bad perceptions are long-term and may be easier to live with than to resolve. Often, however, image problems crop up suddenly and pose a serious threat to the company’s well being. Managing such a crisis requires a three-step PR process.

 

First, you need to determine what public(s) you need to deal with. If you work for a sports franchise that’s come under fire for having a racist name or logo, whom would your public be? Members of the offended ethnic group? Companies that advertise at the stadium? The team’s investors? The team’s fans? All of the above?

 

Next you need to determine if you have a problem. Sometimes a bad event can seem like trouble, but research shows that the public you’re worried about doesn’t particularly care. Unfortunately the opposite can also be true. So at the first hint of a challenge, PR people should be hard at work trying to figure out if the public is genuinely upset.

 

Assuming a problem exists, the final step is to do something about it. Now PR pros bring all their skills to bear in order to put a “positive spin” on things. The best practice is to avoid lying and covering up, which can make a bad situation far worse. The company should admit that a problem exists and clearly explain what it’s doing to fix things.

Love your country, hate your enemy

 

The dry definition of “propaganda” is “persuasive mass communication from a government, typically to build support for a war effort.” The practical reality is far more interesting. Governments maintain power over their people using a combination of persuasion – the “carrot” – and force – the “stick.” In media-consuming societies, propaganda is a big part of the carrot.

 

The art of propaganda can be divided into three basic messages, the first of which is “love your country.” In its easiest form, this is a simple appeal to patriotism, the natural inclination toward allegiance to a nation, region or other group. If you want a practical demonstration of the persuasive power of patriotism, ask yourself when you last saw a man run for office without keeping an American flag pin constantly stuck in his suit lapels.

 

Other kinds of love can be trickier to inspire. Unlike dictatorships, democracies can’t breed loyalty to one particular person. In most elections, many people vote for the person who ends up losing, and they may not have much affection for the person who does. And it can be hard to get people to fall in love with abstract names, places and concepts.

 

One way around the problem is to come up with something concrete that people can emotionally bond with. If “America” is hard to imagine all at once, then the American flag, American eagle and Uncle Sam are far easier to picture. Not to mention way easier to put on a poster or write into a song.

 

Another technique is to associate the country with something else that people already love. Consider the phrase “as American as Mom and apple pie.” Even if your mom never baked a pie in her life, you can still feel the warmth of family affection now identified as something uniquely American.

 

If love can be used as an effective propaganda tool, then the same is likely true of love’s opposite. Hatred is a powerful motivation, and propaganda often seeks to exploit it.

 

During wartime, hatred of the enemy is particularly crucial. Success on the battlefield often depends on exploiting the parts of human nature that prompt us to kill one another and suppressing the parts that prevent us from doing each other in. Propaganda aids this cause by portraying people on the other side of the conflict as inhuman (monsters, vicious animals, psychotic criminals and the like). It also emphasizes the danger the enemy poses to our way of life and those we love.

 

One of the oft-criticized elements of hate-based propaganda is racism. Such messages may make the enemy easier to kill, but at the same time they rob people of their humanity. Even if this is a “necessary evil” in combat, it can prove dangerously counterproductive in other environments.

 

During the Second World War, American propaganda demonized the enemy. Our Italian foes were typically portrayed as ugly caricatures of Italian dictator Benito Mussolini. Likewise Germans were typically represented by Adolph Hitler or another easily recognized member of the Nazi government. The Japanese, on the other hand, were almost always shown as generic, cruel Asian stereotypes (sickly yellow skin, huge teeth, thin moustaches, thick glasses and thick accents).

 

This focus on an entire people rather than just their leadership had far reaching consequences. During the war, Americans of Japanese descent suffered harsher discrimination than people with German or Italian ancestors. And even decades after the war ended and normal relations resumed between the United States and Japan, a deep-seated hatred still lingered among some members of the “greatest generation.”

 

 

The birth of advertising

 

At its simplest, advertising is the practice of paying a mass communicator to convey a commercial message for you. Not long after newspapers were invented, publishers came up with the idea to charge local businesses to run “come buy our stuff” messages.

 

In a small town with only one newspaper, arrangements between businesses and the publisher were easy to make. In bigger cities with multiple newspapers and larger, more diverse populations, getting the message out was trickier business.

 

Enter the ad agency. Originally, agencies were nothing but space brokers. Rather than coordinate with many media outlets, a business could hire an ad agency to buy the space in all the appropriate publications. The agency got paid a percentage of the cost of running the ads.

 

Such commission-based billing continues today, with the agency typically receiving 15% of the total bill. So if an agency bills a client $100 for running an ad, the medium charged the agency $85 and the agency tacked on a $15 commission before passing the bill on to the client.

 

Traditionally the commission was the agency’s only way of getting paid, which meant that it had to do a good-sized volume of business with the client in order to provide full service and still turn a profit. Thus many agencies will bill separately for expensive expenses such as celebrity endorsements.