Adland (27 page)

Like the BMW campaign before it, the Sony commercial offered an insight into the way consumers interacted with brands on the web. Agencies were slowly beginning to tame the internet, even though many of them still bore the scars of their earlier over-hasty efforts.

14

Dotcom boom and bust

‘We just wasted two million dollars'

I
n December 1999 I was holed up in a hotel in New York City, idly zapping through TV channels while I waited for the streets to thaw. Dotcom advertising was everywhere that winter: I remember stumbling across a spot for
Amazon.com
featuring a motley group of employees in Santa hats singing carols. Other dotcoms followed the same ‘wacky' route, while similarly failing to explain exactly what they were trying to sell. When I returned to New York a year later, most of them had vanished from the screen forever.

Were advertising agencies to blame for the dotcom bust? There are certainly grounds for arguing that they hastened the implosion. Hypnotized by the venture capital cash being waved in their faces, they agreed to shelve everything they'd learned about building brands in order to produce shallow, only occasionally witty advertising whose sole aim was to generate hyper-rapid awareness for their clients. Meanwhile, traditional advertisers rushed online with clunky banners and pop-ups.

It was fun while it lasted. On 10 September 1999
Campaign
magazine ran an article headlined ‘The dotcom wars'. Its first sentence read: ‘If somebody were to make a billboard for the dotcom age, it would be several hundred feet high and sprawl across Highway 101 in Silicon Valley, reading “Welcome to the new gold rush”.'

In 1998, the top 50 internet advertisers in the United States had spent only US $420 million on offline advertising. In the first two months of the following year, the dotcoms increased their ad spend by more than 280 per cent. On the other side of the pond, the UK was experiencing a similar boom. By the end of 1999, total spend on advertising had passed the £15 billion barrier for the first time. A spokesman from the Advertising Association said that dotcom advertising activity was bolstering the
success of traditional media. ‘It's difficult to see any clouds on the horizon,' he added (‘Dotcom boom helps propel UK ad spend beyond £15 billion mark', 26 May 2000).

The outdoor industry was one of the greatest beneficiaries of this largesse, as dotcom companies plastered their incomprehensible logos all over town. Billboards did indeed clutter Highway 101. In the UK, spend on outdoor advertising by dotcoms rocketed from £1 million in 1998 to an implausible £23 million by the end of the following year. Rather than building brands, many of these posters were aimed at attracting investors. There were reports of British dotcoms asking their media buyers to concentrate on sites in the City in order to raise their profile among the financial community.

There were occasional voices of reason. Stevie Spring, chief executive of the poster contractor More, told
Marketing
magazine: ‘What we've seen is the dotcom companies needing fast fame, and spending lots of money to do it. Most have yet to get to the next stage, where they have to really build brands as well' (‘Dotcoms gain real presence outdoors', 30 March 2000).

The dotcom frenzy reached its height during the last half of 1999 and the first weeks of the following year. Agencies in the United States reported fielding five calls a day from dotcoms who wanted to get campaigns off the ground by the fourth quarter. Some agencies warned that brand-building took time, while others admitted that it was difficult to turn down multi-million-dollar clients.

An article in
New Media Age
summed it up rather well: ‘Bewildered middle-aged agency suits sat open-mouthed as teams of idiots in three-quarter length trousers and Japanese trainers hosed backers' money at them… They took briefs from 26-year-old marketing directors whose sole previous experience had been the production of club fliers…' (‘How dotcoms killed off the ad agencies', 13 September 2001).

Even when the teams behind them were reasonably experienced, the ads were nothing if not eccentric. In the UK the faces behind
ready2shop.com
– fashion experts Trinny Woodall and Susannah Constantine – also turned out to be the bodies behind the site, appearing naked in a print ad. Others resorted to the emerging ‘guerrilla' style of advertising. The women's site
Hangbag.com
projected its logo and URL onto the side of the Natural History Museum, which was hosting a London Fashion Week event. A spokesman said: ‘We wanted to bring the Handbag brand
out of the ether and inject it with an urban, streetwise personality.' It may have been the first and last appearance of the words ‘handbag' and ‘streetwise' in the same sentence.

The apotheosis of the dotcom boom was the Super Bowl of 2000. Dozens of dotcoms blew millions of dollars on dizzyingly expensive and mostly dreadful 30-second spots. Top prize for hubris went to
E-Trade.com
, which ran a loony ad featuring a dancing monkey. The endline said: ‘We just wasted US $2 million. What are you doing with your money?'

And what exactly did the dotcoms get for their money? As
Salon.com
pointed out in its after-match report, ‘the bottom line looks like a bit of gawking press coverage and a temporary [surge] in site traffic, but nothing so lasting that it could be called “brand building”, and nothing so irrefutably valuable… that it could possibly justify the huge expense for a whole batch of unprofitable companies' (‘
Fumble.com
', 3 May 2000).

One Super Bowl advertiser was to become the symbol of the dotcom bust:
Pets.com
, whose jaunty sock puppet mascot charmed a nation, but utterly failed to save a company. ‘What bell-bottoms were to the 70s, the sock puppet was to the dotcom era,' commented
Wired
magazine (‘1999 – What were they thinking?', August 2005).

Pets.com
burned through millions of dollars in two years. Like another famous dotcom casualty, the fashion site
Boo.com
, it found that the cost of administration, storage, shipping and marketing greatly outstripped income. As it prepared its Super Bowl ad, it had already lost US $61.8 million on sales of US $5.8 million to the end of December (‘
Pets.com
to put puppet on Bowl',
USA Today
, 25 January 2000).

The sock puppet was created by TBWA/Chiat/Day in San Francisco. It was basically a fuzzy white sports sock with mismatched felt eyes, brown markings, a red tongue and ears tagged on with safety pins. Its collar was a wristwatch and it carried a microphone. The ads were knowingly amateurish and the puppet's wisecracking style appealed to consumers. (In one Christmastime ad, the puppet stared at the row of stockings hanging on the fireplace, turned to the camera and intoned, ‘The horror!') Each spot ended with the line, ‘… because pets can't drive'.

The sock puppet generated articles in the press and was invited onto talk shows. A range of merchandise was launched to capitalize on its popularity. Despite the success of the advertising, customers failed to
bite, believing they were better off going to the pet store than waiting to receive dog food and cat litter they'd ordered online. While
Pets.com
went under, the sock puppet remained its most valuable asset, and was eventually sold on to a licensing company. The advertising agency had done a brilliant job of selling the mascot, but had been unable to raise enthusiasm for the site.

Pets.com
was the perfect case study of dotcom fever. As the
Financial
Times
explained, investors had ‘dared to dream of new internet-based commercial markets with instant worldwide reach'. In the first flush of enthusiasm, the dotcom companies ‘did not need to prove that their ideas would work, only that they had a compelling vision' (‘Tech stocks in turmoil', 23 December 2000).

When investors realized that it would be years before most dotcoms went into profit – if indeed, they ever did – they cooled off fast. By the winter of 2000, the temperature was glacial. The
FT
article reported that the Nasdaq market, home to the biggest tech companies, had lost more than US $3,000
billion
in value since its peak the previous March. ‘This will go down as the year in which more stock market wealth has been destroyed than ever before.'

As traditional advertising felt the icy blast, online spending froze. In the United States, the Internet Advertising Bureau confirmed that after growing at rates of 150 per cent year on year, spend in the third quarter had fallen by 6.5 per cent – the first decline since the IAB began issuing figures in 1996. Ironically, this was partly due to the success of the internet as a medium – the number of website pages was growing as fast as the number of advertisers shrank. Many of the departed were bust dotcoms; but traditional brands were also wearying of the web.

An article in
The Economist
summarized the situation nicely. It pointed out that in print advertising there was a high level of wastage – advertisers in newspapers and magazines paid the same price for a space regardless of whether readers looked at their ads or not. But on the internet they were paying for page views or clicks on their banners. In other words, unlike their deal with magazines, they weren't forced to pay for people who didn't notice their ads. ‘Online publishers are, in effect, punished for the efficiency of their medium' (‘Banner ad blues', 24 February 2001).

When the situation normalized, everyone seemed vaguely surprised that the internet had not vanished in a puff of smoke. In fact, the web
continued its rise as a powerful medium for information and entertainment, but advertising on it required a more sophisticated approach. Increasingly it became deployed as one element of a multimedia campaign. Banners began to look as outmoded as lead type. The emerging social networks offered the chance not just to advertise to consumers, but also to converse with them.

The one thing everybody accepts is that the digital explosion has changed the advertising equation forever. Even 15 years ago, it was difficult to imagine a scenario in which the TV set gathered dust in the corner of the room while people consumed entertainment on ever smaller, more portable devices. But now it seems very plausible indeed.

15

Latin spirit

‘Football fans chant advertising jingles on the terraces'

‘I
f you want to find Spanish agency people in Cannes,' somebody advised me, shortly before I set off for the annual advertising jamboree, ‘first look for the South Americans. They're always swapping countries with one another.'

This insight not only turned out to be entirely accurate – as we're about to discover – it also prompted me to cover Spain and Latin America in the same chapter. As well as having strong historic, cultural and mercantile links, the Spanish and the South Americans make a similar kind of advertising. Jacques Séguéla would call it ‘the advertising of the heart'. In other words, it has a certain warmth and sensuality that the work produced by the droll Brits, the wisecracking Americans and the suave French often lacks.

As luck would have it, the first Latin American agency types I ran into were two Argentine guys from Publicis Lado C, a Madrid outfit. Creative duo Fabio Mazia and Marcelo Vergara were working at the famous Argentine agency Agulla y Baccetti – one of the biggest names of the eighties in that market – when they were lured to Spain by BBDO, which wanted them to work on the Renault account. Later, when Renault shifted its business to Publicis, they were asked to set up a spin-off agency to handle the client.

‘We'd never considered changing countries before, but the shared language made the decision easier,' confirms Mazia, as he and his colleague relax in a hotel bar in the scruffily trendy way that only creatives can pull off. ‘Of course, it's still 12 hours away by plane and another continent, and there are as many differences as there are similarities. But Agulla y Baccetti has fathered a generation of Argentine advertising people who are now gaining international recognition. Juan Cabral [of Fallon] is the perfect example.'

Other Argentine agencies are also considered influential: in particular Savaglio/TBWA. Ernesto Savaglio is one of the country's best-known admen, having repositioned supermarket brand Carrefour in the early 1990s with a populist campaign that doubled as a protest against hyperinflation. He specialized in satire, controversy and adopting ‘the voice of the people'; an unfamiliar tone in advertising at the time.

I ask Mazia if he feels that there is an Argentine ‘style' of advertising. ‘The country is such a mixture of cultures that the result is highly idiosyncratic,' he replies. ‘For example, there is an ironic sense of humour, which contrasts with a strong love of sentimentality. I'd say it's a blend of Spanish culture, Italian culture, American culture, and a melancholy sensibility that is often associated with the tango. I also think people admire the fact that we have Third World budgets, yet we manage to do First World advertising. Having to be creative on a small budget forces you to stretch your talent.'

Vergara adds, ‘One of the main differences [from Europe] is that Argentine people love advertising. Football fans chant advertising jingles on the terraces and sitcoms refer to popular campaigns.'

A mention of football leads us neatly on to a country that has had a disproportional impact on global advertising – and especially on Cannes, where it has reaped an impressive pile of awards over the years. It is, of course, Brazil.

The boys from Brazil
1
: Washington Olivetto

‘In the sixties, Argentine advertising was better than ours,' considers Brazilian advertising guru Washington Olivetto. ‘Several leading Argentine creatives moved here, which contributed to the development of our own advertising. After the eighties, Brazil greatly outdistanced Argentina in creative terms. More recently the gap has closed again.'

Olivetto is the superstar of Brazilian advertising – as famous there as any rock musician. This high profile led to him being kidnapped in 2001 and held for 53 days before he was released in a police raid. But Olivetto had already generated many more – and more cheerful – column inches before that incident. For a start, he is listed in the
Guinness Book of Records
as the creator of the longest-running advertising campaign with the same leading character, for household cleaning product
Bombril. The simple but highly effective idea has comedian Carlos Moreno impersonating various unlikely figures – from Che Guevara to the Mona Lisa, but more often contemporary politicians – in amusing print and TV ads. It has racked up more than 300 versions.

Olivetto launched the campaign in 1978, when you'd have been hard pressed to find another image of a Brazilian man who was willing to do the housework. Traditional male/female stereotypes were only just beginning to break down – and Olivetto's campaign struck a chord with consumers. Research showed that 90 per cent of those who'd seen one of the ads couldn't wait to find out who Moreno would be impersonating next. At one point the spots were so popular that they appeared in the TV listings.

‘The campaign was actually dropped in 2004, but it was brought back by public demand in May 2006,' says Olivetto. ‘The characters tend to be topical, so the blend of advertising with news and satire means that the campaign never goes out of date. Moreover, the talent of the protagonist, Carlos Moreno, is awesome, making our job much easier.'

Olivetto has a writer's soul and a salesman's charm. He was, he says, reading and writing prodigiously at the age of five. Growing up, he imagined a future in journalism. But he also admired his salesman father, and was delighted to discover ‘that I could blend the style in which I wanted to write with the style of selling that I most admired – ie advertising. I decided to become a copywriter.'

Modern Brazilian advertising began in the 1960s, says Olivetto, but ‘it gained visibility and strength in my generation – in the seventies and particularly the eighties, when we began to get noticed internationally. The strength and quality of Brazilian television, in particular TV Globo, was undoubtedly fundamental.' Launched in 1965, the Globo network is one of the world's most popular TV channels, with 80 million viewers every day. It is famous for its prime-time soap operas, or
telenovelas.
Its parent company beams Portuguese language satellite programming around the world.

Olivetto started out as a trainee at a small agency called HGP. But it was with his next agency, Lince Propaganda, that he won a Bronze Lion at Cannes, for an ad for a brand of designer bathroom fittings called Deca. He was only 19 years old. ‘The award gave me a lot of visibility and I was invited to work for DPZ, which at the time was the most
brilliant Brazilian agency. I became creative director and stayed there for 15 years.'

In 1986 he was invited by the Swiss advertising group GGK (see
Chapter 9
, European icons) to set up its Brazilian outpost, originally to handle the Volkswagen account. Dubbed W/GGK, the outfit's billings increased eightfold in three years; in July 1989 Olivetto and his business partners bought the Swiss shares in the agency with Brazilian capital and renamed it W/Brasil.

The agency developed a reputation for eye-catching TV advertising in a market where airtime was actually cheaper than magazine space. Brazilians were gluttonous TV viewers: a
telenovela
was capable of pulling in 90 per cent of all households. For the price of a double-page spread in an upmarket magazine, the agency could place a 30-second spot during the news and reach 45 million people. Olivetto admitted at the time that, owing to the country's schizoid economy and supersonic inflation, only a fraction of that number was likely to buy the products he was promoting. But, rather like Argentine viewers, ‘Brazilian people love to be entertained by the television and are very receptive to advertising.'

When then President Fernando Collor de Mello froze a large chunk of personal and corporate savings as an anti-inflationary measure in 1990, Olivetto acted quickly. For a tyre retailer called Zacharias – whose customers had evaporated overnight – his agency created an ad reading, ‘If you have anything which needs doing but no money, come in and we'll find a way.' It put into practice, in extreme circumstances, the theory that brands should continue advertising during a recession, so they can emerge in a stronger position when the economy recovers. Olivetto did not suggest this approach to all his clients, however. ‘We concentrated on clients selling [fast-moving] consumer products and advised others not to advertise. People just won't buy new washing machines in a climate like this,' he told the
Financial Times
. ‘We want our clients' business for 20 years, not three months, so we were totally fair in giving our views of their prospects' (‘Finest moment of adland's rock star',
Financial Times
, 19 July 1990).

Even in that harsh environment, the
FT
seemed to approve of the flamboyant Olivetto style. ‘He regularly sends flowers to the female staff, the day's work is celebrated with drinks all round and every other Friday, stars are brought in ranging from TV personalities to footballers, artists to singers,' the newspaper enthused.

Today, of course, Brazil is one of the promising BRIC economies, along with Russia, India and China. And although the country has not quite delivered the boom that some analysts predicted, the fact remains that W/Brasil now has a far larger pool of consumers to reach with its warm and witty advertising. And Brazil itself continues to do well in international advertising competitions. How does Olivetto explain this success?

‘What makes Brazil an extraordinarily creative country in advertising and in other areas – such as music, soccer, architecture and fashion – is the miscegenation factor. We are a blend of many races and that makes us creative, sensual, musical, talented and good-humoured.'

Despite his appreciation of this cultural
métissage
, Olivetto is one person who won't appreciate my linking Spain with South America – or indeed Brazil with the rest of the region. According to him, Brazil should have a chapter to itself. ‘Brazil is not situated in Latin America. It is a continent apart, with a different language, different features and its own personality. Obviously, our Latin-American, Italian and Spanish brothers influence us. However, our personality is absolutely distinct, which is neither a quality nor a shortcoming. It is just our way of being and this reflects itself in our behaviour and in our advertising.'

The boys from Brazil
2
: Marcello Serpa

One of the agencies Olivetto commends is Almap/BBDO, which regularly spearheads Brazil's assaults on Cannes. The creative force behind the agency is Marcello Serpa, who in his early forties is already something of an adland legend, with truckloads of awards to his name. As approachable as he is physically imposing, he is also credited with having pioneered a new kind of print advertising.

While he is, as he puts it, ‘100 per cent Brazilian', Serpa began his career in Germany, where he studied graphic design and commercial art in Munich from the age of 18. He then worked at GGK in Düsseldorf – which, as we've already established, was the top German creative agency of its day. In 1987 he finally returned to Brazil, where he worked for the agency DPZ in Rio de Janeiro and then São Paulo. His next stop was DM9, part of the DDB Worldwide network. It was here that he won Latin America's first Grand Prix at Cannes, in 1993, with a campaign for the diet soft drink Guarana. It simply showed two perfectly
toned, tanned and slender torsos, with bottle caps covering their taut navels. No further explanation was necessary.

‘The approach came out of my education in Germany,' Serpa explains. ‘Brazilians are very anarchistic in their approach to creativity, while Germans are far more disciplined. They gave me the concept of reduction, by which I mean expressing an idea in the simplest possible terms. Every inessential element must be removed. At that time, straightforward, purely visual ideas were still unusual.' He chuckles. ‘[Famed copywriter] Neil French says I was responsible for killing long copy in advertising, though of course it never entirely went away.'

Serpa's approach was illuminating in that it showed the direction advertising would take in the new era of globalization. Multinational youth-oriented brands needed campaigns that could run across many markets with minimal adaptation, so heavy copy and wordplay were out.

A minimalist approach also suits the Brazilian market, suggests Serpa. ‘We don't always have very big budgets to play with in Brazil,' he says. ‘Sometimes we're expected to make a TV commercial for one hundred thousand dollars, which is a drop in the ocean compared to an American super-production. And simple ideas are often inexpensive ideas.'

The year 1993 turned out to be a pivotal one for Serpa, because he also joined Almap BBDO as joint CEO with José Luiz Madeira – who came from a planning background – and the pair proceeded to transform the agency. Founded in the 1960s by Alex Periscinoto and Alcantara Machado, Almap had been acquired by Omnicom in 1988 and attached to the BBDO network. Considered lugubriously traditional at that point, it was rejuvenated by the appointment of Serpa and Madeira. They produced award-winning work for Audi, Volkswagen, Pepsi and Bayer, among others, and the agency topped lists of the most awarded in the world. From then on, there could be no doubt that Brazil was firmly on the creative map.

Serpa claims Brazilian clients have become ‘a bit less brave' in the face of a sluggish economy, but he tempers this with the observation that they benefit from the country's pro-advertising culture. ‘In Brazil, clients are consumers too. They don't sit in their ivory towers adding up figures – they actually watch advertising at home with their families. And they care about what people think. They want a spot that's going to stand out and impress their kids. Clients say to me, “Can't you give me a commercial that everyone will be taking about?” That's a very refreshing approach.'