MEDIA: Could ad agencies be in danger of losing the plot?

This week I sat through a long analysis of the current state of television advertising, which demonstrated that you have to run a commercial nine times on Sky One in order to match the impact of just one spot on ITV.

This week I sat through a long analysis of the current state of

television advertising, which demonstrated that you have to run a

commercial nine times on Sky One in order to match the impact of just

one spot on ITV.



One of the cheery conclusions was that the status quo still holds: there

is nothing to match the sales power of a commercial break in one of the

channel’s most popular programmes if you want to launch a new car.



Viewers also zap out of commercial breaks less when they are within a

favourite programme, such as Coronation Street. Although satellite

airtime rates are up to 40 per cent cheaper, this hardly compensates for

the reduced loyalty and audience.



However, there are signs of rapid change at the margins and this is

going to have profound implications for the advertising industry.



If you study the ads going to the small, niche channels, an increasing

number are direct response commercials. In other words, companies are

actively seeking out these tiny, more specialist audiences because they

are easier to deal with and clearly lucrative. The ads require little

creative input beyond repetition of a phone number. The calls from

customers are handled without long delays and there is less wastage.



This sense of being on the verge of a major change in the way we are

persuaded to make a purchase has been captured by the recent CIA Sensor

tracking study. This found a dramatic rise in the willingness of people

to buy a wide range of goods over the phone, through direct mail and,

eventually it predicts, the Internet.



It found, for example, that in the 15 to 24 age group, the real

satellite television generation, these personalised methods were viewed

with extreme favour, though they loathed intrusive commercial breaks,

and one in three were familiar with the Internet. This suggests that,

while the 30-second standard ad still has its place, advertisers will

needto create a far more sophisticated network of messages to keep up

with the shifting attention of their audiences.



While there are still plenty of advertisers grappling with placing their

messages on the Internet, and a growth in sites, there are fears that

the mainstream advertising agencies are still lagging behind both their

clients and the new media-literate generation.



At the Price Waterhouse launch of its hefty annual Entertainment, Media

and Communications Technology Forecast last week, one consultant argued:

‘In the same way that the financial services sector sat around believing

a clothes retailer (Marks & Spencer) could never enter their market, it

is possible that in five years’ time Microsoft or Netscape could have

higher billings than many agencies today.’



The solution: agencies need to start recruiting some red-hot computer

nerds.



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