Citigroup : Advertising Agencies have not collapsed - yet
March 18, 2008
CHICAGO (MarketWatch) — A leading advertising agency echoes the notion that there hasn’t been a recession-related decrease in ad spending so far this year, an analyst said Tuesday. Discussions with two executives from the ad agency Initiative Media (IPG The Interpublic Group of Companies, Inc, according to Citigroup’s Catriona Fallon, revealed that advertising budgets are likely to be up by 3% to 5% for 2008 “with no pullback yet evident.” Some $2 billion to $3 billion is expected to come from election-related ads, while an unspecified amount will come from the Summer Olympics telecasts, Fallon quoted the executives as saying.
For 2009, however, ad spending is expected to be about flat, the analyst said, with early signs of the slowdown perhaps showing up this May — when advertisers buy commercial time for the fall-TV season.
“If we do see a pullback later in the year, it would come from more traditional advertising — especially preprint and broadcast-TV advertising, and less from digital spend,” Fallon wrote her note to clients. In a weakened economy, she added, local online-search advertising will decrease before that of larger companies
Fallon thinks that search marketing will crash before quarter million dollar full page ads in US news and world report will? How’s Citibank’s stock trading?
Rumor Mill : Interep to declare bankruptcy
March 18, 2008
We are receiving unconfirmed reports that Interep might be on the verge of declaring bankruptcy. These are rumors, but the radio giant refused to comments on this report.
Interep is the largest independent advertising sales and marketing company in the United States specializing in radio, television, the internet, and events.
An “anonymous” source stated that the Interep bankruptcy has been in the works for some time now and was surprised this is just now hitting the internet. There is a 100 million dollar bond that is due for them, and the likelihood of them being able to pay it are slim to none.
Story is developing…
EDIT: Steve Hall’s Ad Rants appears to be confirming the story
Indicted ad agency owner enters innocent plea - Robert Sullinger
March 18, 2008
The Advertising Agency industry is so shady … This guy is accused of taking 1/2 a million dollars from the Government to put up anti-drunk driving billboards and instead of using the money to buy the billboards and create the copy… he pocketed the money.
Great public service…. This is the problem with the industry… it’s rife with fraud… and the old boys club stands well…
SPRINGFIELD, ILL. (AP) — The owner of a Springfield advertising agency accused of stealing $500,000 in federal funds that was to pay for anti-drunken-driving billboards has pleaded innocent to fraud charges.
Robert Sullinger is the owner of Great Plains Group LLC. The 59-year-old Sullinger was paid more than $1.5 million in federal grant funds to produce and post billboards and posters throughout Illinois.
Sullinger is accused of submitting fraudulent invoices for the billboards from 1999 through 2004. He is also accused of understating his profit margins and then trying to cover up the scheme.
Sullinger faces up to 20 years in prison on each of the mail fraud counts and up to five years in prison on each of the others.
He also could face tens of thousands of dollars in fines.
A trial date is set for May 6.
Harte-Hanks, Inc targets U.S. government agency contracts
March 18, 2008
VIENNA, VA - Harte-Hanks, Inc. (NYSE: HHS) announced today that its direct response advertising agency, Harte-Hanks Direct, has been certified by the federal General Services Administration (GSA) as a provider of advertising and integrated marketing services. This will enable the worldwide direct and targeted marketing company to compete more readily for U.S. government agency contracts.
The GSA contract enables federal agencies, when they require such services, to invite Harte-Hanks to submit bids for this work using the GSA vendor selection process, the company reported.
“The GSA certification and contracting process is rigorous,” said Gary Skidmore, president, Harte-Hanks Direct Marketing. “In considering vendor candidates, GSA reviews a comprehensive set of metrics from financial stability and past performance to capabilities and references as part of our certification application. By achieving such certification, we now are able to have direct access to many federal agencies seeking marketing services — exposing us to far more opportunities than we have had previously.”
Harte-Hanks Direct is based in Yardley, PA, with a supporting office for the government sector in the Washington, DC metropolitan area. Currently, Harte-Hanks, across various businesses of the company, holds prime and sub-contracts with the U.S. Postal Service, the Internal Revenue Service and the Army National Guard among its public sector clients.
The GSA contract, which became effective January 28, 2008, covers advertising strategy, creative, direct mail services, media services, broadcast, measurement, as well as Web and call center services related to campaigns.
About Harte-Hanks
Harte-Hanks is a worldwide, direct and targeted marketing company that provides direct marketing services and shopper advertising opportunities to local, regional, national and international consumer and business-to-business marketers. Visit the Harte-Hanks Web site at http://www.harte-hanks.com or call (800) 456-9748.
Cautionary Note Regarding Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the U.S. federal securities laws. All such statements are qualified by this cautionary note, which is provided pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements other than historical facts are forward-looking. Examples include statements regarding potential U.S. government agency contracts for our marketing services and other statements regarding future events, conditions or outcomes. These forward-looking statements involve risks, uncertainties, assumptions and other factors that are difficult to predict and that could cause actual results to vary materially from what is expressed in or indicated by the forward-looking statements. These risks, uncertainties, assumptions and other factors include, without limitation, the federal government’s selection process for any future marketing contracts, economic and business conditions, federal government demand for our services, competitive factors and other factors discussed under “Item 1A. Risk Factors” in Harte-Hanks’ most recent Form 10-K and any updates thereto in Harte-Hanks’ Forms 10-Q. The forward-looking statements in this press release are made only as of the date hereof and we undertake no obligation to update publicly any forward-looking statement, even if new information becomes available or other events occur in the future.
Media Contacts:
Chet Dalzell
Harte-Hanks
(212) 520-3232
Email Contact
Public Sector Business Contact:
(703) 388-2801
Advertisers and Advertising Agencies shun user-generated video
March 17, 2008
Although more money is going to online video advertising, relatively little of that is subsidizing user-generated video “� the short, often-wacky clips from amateurs. Many advertisers, for now, are staying away for fear their ads could inadvertently appear with clips that have nudity, foul language or perhaps criticism of their brand.
Advertisers and Advertising Agencies evidently never heard of a thing called YouTube. Where the videos will be uploaded regardless of what the company states. There is an old phrase, keep your friends close and your enemies closer. If they view these home videos as a threat, wouldn’t it make more sense to keep them at least somewhat under control rather than motivate them to publish things negative about the company?
The logic ceases to amaze us, these videos are produced for free.. with virtually no cost to the company (or very little cost as compared to the traditional approach). distribution costs are footed by YouTube (Google) … so the entire concept of this debate puzzles us. It’s a no-brainer in our opinion.. mostly because if someone wanted these videos out… they will get out period.. and there is nothing the advertiser could could do about it… they would be shown on YouTube / Google Video or 200 other outlets.
It’s a poor business decision not to allow user created videos in your marketing plan.. in fact, some have stated that user videos are of higher quality that advertising agency created content…. go figure.
Elliot Spitzer’s paid ‘girlfriend’ had higher billable hours than this.
March 17, 2008
Pretty Crappy to extreme levels. Agency Spy is reporting that Disney wants to give an Agency 50 grand to come up with a great idea so they can make millions from it. The original source of this article was from Brand Week.
Pretty horrific… but for any agency to actually consider this a great idea must be facing the fact that we are in a recession, and well… an agency has to do what an agency has to do… even if that means working the street corner for 50 grand. Elliot Spitzer’s paid ‘girlfriend’ had higher billable hours than this.
Agencies that are trying to get into this are Kirshenbaum Bond + Partners; Droga5, StrawberryFrog and Wieden + Kennedy, Cutwater in San Francisco; and DraftFCB in Chicago.
Hey agencies, want to boost your bottom line? How about investing in interactive and not losing millions for the 50 grand bait.
Disney totally outclassed them with this… amazing stuff.
Advertising Agencies and the 2008 Recession
March 17, 2008
It’s no longer debatable if a recession is here. The recent collapse of Bear Sterns from 170 dollars a share to 2 dollars a share sort of puts it in black and white for most of us.
Some Ad Agency executives such as Sir Martin Sorrell are stating that it’s not 2008 that they fear but 2009. We tend to disagree, some of the non-traditional interactive marketing firms continue to land substantial accounts while their traditional firms are seeing decreased budgets.
It’s a fact that traditional advertising agencies have significant overhead (such as quarter million dollar full page ads in magazines), and with increased fuel prices and distribution costs it will start to hurt them faster than a higher ROI marketing plan that involves a dedicated server and a good interactive plan.
Search Engine Optimization, releasing videos on Youtube rather than TV and cutting out print normally does wonders for a firms ROI. It’s not rocket science, it’s common sense.. it costs companies more to distribute via traditional channels than online, and typically a well run online campaign generates a higher ROI overall in simple terms of money in vs money out. The primary reason for it is that the money in aspect is generally lower… much lower than the traditional route and the viewership online in some regards outpace the traditional route, especially during the Monday though Friday 9-5 time slot. The time when professionals have a computer in front of them the whole day with no TV or radio.
It’s a pain for traditional firms for the fact that they lack the skillset for online marketing with their heavy print and tv expertise.
Don’t believe us? In a few weeks several thousand people will view this article. It took some time to type up and publish… but that was the total cost.. Google, Yahoo and MSN will index this post in a relatively short time frame. People will start coming in to see it… and bingo.. our message got out… that the ROI for this post will be higher than that of a print media ad. The total billable for this article… should it of been a client …. would of been 1-2 hours … and no other additional charges. For traditional this would of been a higher hourly rate (it takes many more hours to make a TV or Print spot) plus distribution costs.. plus the 20% over spend for that distribution cost.
It’s a no-brainer… and it’s the reason why Advertising Agencies need to invest in InterActive to make it though this recession.
McDonald’s and Disney : Canadians are idiots
March 16, 2008
According to the official rules of the contest, this was published on a McDonald’s happy meal.
To win, A Canadian resident must correctly answer a skill-testing question.
You can make it out the best on the first image (Cell phone camera pics) … What are Disney and McDonald’s trying to state about Canadians?
Elliot Spitzer stars in new Virgin Mobile Ad
March 14, 2008
That was fast… really fast… and not only that some are raising the legality of doing such (read the comments on Agency Spy).
It’s shameful. “I am tried of being treated like a number” is the subject.
Happy Friday - Who’s on First
March 14, 2008
Happy Friday everyone, I hope you enjoy the clip
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