The pitch that you won’t see coming

Times Staff Writer

Robert Liodice, president and chief executive of the National Assn. of Advertisers, took the podium before a banquet hall of marketing execs recently to tell them what they already knew: Advertising is dead.

“Consumers don’t want to be marketed to like some robotic object,” he said, as if debunking conventional wisdom. “Rather, they want to be involved, engaged and, in fact, entertained.”

For the record:

12:00 a.m. Aug. 29, 2004 For The Record
Los Angeles Times Tuesday August 24, 2004 Home Edition Main News Part A Page 2 National Desk 1 inches; 38 words Type of Material: Correction
Advertising group -- A Sunday Calendar story on the growing presence of advertising throughout U.S. culture identified Robert Liodice as president and chief executive of the National Assn. of Advertisers. The group is the Assn. of National Advertisers.
For The Record
Los Angeles Times Sunday August 29, 2004 Home Edition Sunday Calendar Part E Page 2 Calendar Desk 1 inches; 38 words Type of Material: Correction
Advertising group -- An article last Sunday on the growing presence of advertising throughout U.S. culture identified Robert Liodice as president and chief executive of the National Assn. of Advertisers. He is with the Assn. of National Advertisers.

In order to breach a consumer’s “initial headset barrier” against advertising, he said, the sales pitch must be “embedded” in something more palatable, such as a TV show, a sporting event, a video game. It must woo with charm and empathy. Liodice laid out the strategy: “First, capture the consumer’s attention in human, intriguing and emotional ways. Then, embrace the consumer. Get him or her to feel comfortable with you. Finally, make the sale without really selling. Let the consumer know, hey, we’re always there when they need us.”

In fact, advertising is more deeply embedded in our culture than ever before. Almost nothing is excluded from branding -- not our cities, our museums, our schools. Even our private lives are being co-opted by corporations desperate to reframe their images as “authentic.”

“Stealth” strategies are essential to disarm our cynicism, advertisers say. So teenagers are hired to study trends among their peers and develop ways to reach them -- known as “peer-to-peer” or “viral” marketing. Actors are hired to shill product while posing as consumers in Internet chat rooms or on city streets -- in the name of creating “organic” brand awareness. Logos and slogans are “seamlessly” integrated into the story lines of films, video games, even textbooks.


Consumer activists call this “ad creep” and predict an Orwellian corporate takeover of society. But advertisers herald this movement as the future. Soon, they say, advertising will so effectively impersonate the ideas we use to define ourselves that we won’t even consider it selling.

“Advertising,” says Jeff Hicks of the Crispin Porter + Bogusky agency, “will disappear.”

And, consequently, virtually no experience will be commercial-free.

The future is now

Already, the line is blurred. There were the “street musicians” in San Francisco’s Embarcadero BART station substituting AT&T; Wireless pitches for Beatles lyrics. And the “spoken-word poets” performing along with a Nissan commercial in a Santa Monica movie theater. And the “tourists” in Manhattan and Seattle asking passersby to photograph them with their new Sony Ericsson camera phones.

Advertisers are hiring companies that do nothing but “outsource the influencer,” which means finding the hippest person on every block and sending “street teams” to “seed product” to them, creating “organic” buzz. Magazines are hosting branding events -- celebrity parties, concerts and fashion shows -- paid for by their advertisers, whose products end up in the hands of the “cultural influencers” attending.

Brands are also creating their own product-themed content. BMW, American Express and Nike have produced short films, often broadcast online, and hired major Hollywood filmmakers to direct them. Jeep has created more than 20 video games, two network reality shows and a magazine.

As arts funding disappears and tax cuts threaten local governments, advertisers are paying to brand institutions once considered sacrosanct. New York City has declared Snapple its “official soft drink.” Coca-Cola is the “proud sponsor” of the National PTA. Orkin has sponsored an exhibit -- the O. Orkin Insect Zoo -- at the Smithsonian Institution. And at Walt Disney Concert Hall, an auditorium is named for the Ron Burkle Ralphs/Food 4 Less Foundation.

In this reality, brands are personified. They are “living, breathing entities that have DNA,” says Jeep’s vice president of marketing, Jeff Bell, who describes his company’s brand as “more of the singer-songwriter, but it also feels great on the beach.... It’s the only brand I know of that’s very, very comfortable in camouflage fatigues and also at Woodstock.”

Ad agencies develop “ethnographic” and “psychographic” profiles of their brands -- whether snack crackers or luxury cars -- before conceptualizing the campaigns. Once the “personality” is determined, a series of decisions follows, such as which events to sponsor, which celebrities to sign as spokespeople, which genre of movie to be featured in.

Hollywood, not surprisingly, is benefiting enormously from increasingly sophisticated product placement. Just 10 years ago, film studios and TV networks paid exorbitant fees to use brand-name products as props. Today, the roles are reversed. Advertisers often subsidize entire TV productions or movie marketing campaigns for the privilege of featuring their brands.

They pitch their wares as characters in films long before the scripts are finished. Think: “The Italian Job” and the Mini Cooper, or “Lara Croft Tomb Raider: The Cradle of Life” and Jeep. Reality TV has opened up a whole new venue for advertising. Think: Sears and “Extreme Makeover: Home Edition,” or American Express and “The Restaurant.”

Of course, all this integration has become easier as media companies have consolidated, merging paid advertising with entertainment. As New Line Cinema’s vice president of integrated marketing Gordon Paddison notes, “We’re all in the same business. We’re all in the same game.”

The Channel One Network, owned by New York-based Primedia Inc. and produced in L.A., pioneered this approach in 1990 and now beams news and commercials via satellite to 8 million teens in America’s middle and high schools. Late last year, ABC partnered with MindShare North America to create programs showcasing the agency’s clients, including Sears and Unilever; the first program, “The Days,” debuted in July. And GE Healthcare Systems and NBC’s Patient Channel, a 24-hour network broadcast in hospital rooms, delivers a captive audience of 6 million patients and their visitors to drug makers.

“Advertisers are plainly getting more aggressive in their deployment of advertising in every nook and cranny of our culture,” says Gary Ruskin, executive director of the consumer advocacy group Commercial Alert. “And people are getting more angry at that.”

Proof, he says, is the recent rise in government regulation such as the do-not-call registry, an upcoming ballot measure that would require a vote on renaming Candlestick Park in San Francisco, South Carolina’s decision to prohibit the Democratic Party from selling ads on its 2003 primary ballots and the public outcry when Sony Corp. attempted to put “Spider-Man 2" ads on baseball diamonds this past spring.

“On a rational level, when you ask the consumer are they seeing too many ads, the answer is yes,” says Drew Neisser, president and chief executive of New York-based Renegade Marketing Group, whose clients include Panasonic and Nike. “On an emotional level, when they have a brand experience that they enjoy, even though that’s marketing right in their face ... do they complain about it? There is somewhat of a contradiction. The consumer recognizes in many circumstances that advertising underwrites their ability to have certain experiences.”

When it comes to marketing to children, however, this argument rings hollow. Advertisers bank on teenagers being “brand loyal” by age 15, hence campaigns such as McDonald’s “McKids” clothing and videos for toddlers, and sixth-grade math textbooks published by McGraw-Hill that feature references to Nike and Gatorade. (Branded textbooks were banned in California in 1999.)

“There is an underside to this strategy,” says Kalle Lasn, founder of the aggressively anti-corporate Adbusters Media Foundation and Adbusters magazine. “You may have success, but bit by bit by bit you’re painting yourself into a corner.... Many of the real street kids, the real activist types, for them, it is further proof that their culture is so easily being hijacked.... It’s a technique whose success is in diminishing returns and is actually creating more cynicism.”

Selling with sensitivity

Inside an enormous gray and yellow warehouse on a dead-end street in Playa del Rey lies a parallel universe where advertising and empathy are not mutually exclusive. There are no suits here and no real walls, either.

It’s a “playground” designed to create “freedom of ideas,” with a basketball court, a ficus tree park and an espresso bar made from surfboards. Even the inhabitants, none of whom appear to have surpassed 40, lend a certain now-ness to the place with their ironic T-shirts, expensive eyewear and practiced cool.

Here at the West Coast headquarters of TBWAChiatDay, founded in Venice in the late 1970s during a Dodger game and now one of the most innovative ad agencies in the industry, no one will admit -- on the record, at least -- that selling stuff is their goal. And why would they? The relationship between consumers and brands has grown so complicated that such an admission is self-defeating.

After years of media overload, today’s consumers have become just as marketing savvy as the folks here. If they catch a whiff of commercialism, they tune out. So advertisers are turning to the experts -- psychologists, sociologists, anthropologists, neuroscientists -- and employing a sensitivity and intuitiveness that most of us don’t expect from our own families, let alone our favorite brand of soap.

They’re going deeper into our psyches than ever before, analyzing such banal rituals as the amount of time we steep our tea bags, the type of mouse pad we prefer or the source of nostalgia behind our choice of soft drink. They’re identifying how the feminist revolution and our parents’ divorces influence our choice of dog food or sports car or Internet service provider.

“The intellectual side of what we do is becoming more and more complex and more and more necessary,” says Suzanne Powers, director of account planning. “Anthropologically speaking, we’re digging into a brand’s roots as well as society’s roots.”

At TBWAChiatDay, the most disarming staffers are dispatched to hang out in our homes and look over our shoulders in grocery aisles or restaurants, hoping to find that “core truth” that will help Nissan, Apple, Pedigree, Energizer, Sony PlayStation and Adidas “infiltrate culture and get into people’s consciousness in a different way,” as Powers puts it.

For an EarthLink campaign, she says, “we went into people’s homes. We watched them go online.... OK, where are you sitting? What are the things you always surround yourself with? A lot of people grabbed a cup of coffee, they turned on music. Some people had these interesting collections in their little Internet room, these collectibles that they had because they went on EBay.... So we really got a sense of ‘What do these people always do when they’re online?’ which helped us understand very much what the real Internet experience was all about. And, hence, we created a campaign called ‘The Real Internet.’ ”

According to the strategy memo, this is “a place free of unwanted marketing or other intrusions, with tools to protect one’s online autonomy, where what the user wants is more important than what their ISP wants.”

“It’s not about trying to being sneaky -- at all,” Powers says. “It’s about trying to naturally fit in.... We do believe in our brands. Very strongly. And we’re always trying to figure out what is a great way for us to connect to people. How can we connect to people in a really pervasive way?”

Scoping out the trends

If not for her surroundings -- marble-topped boardroom table, sixth-floor view of Wilshire Boulevard in Beverly Hills, Creative Artists Agency publicist seated beside her -- trend forecaster Jane Rinzler Buckingham might be an earnest social sciences grad student and not the president of Youth Intelligence, a CAA subsidiary paid handsomely by Levi’s, Lancome, Electronic Arts and Bank of America to suss out the inner children of Gen X (ages 26 to 37) and Y (14 to 25). (In marketing today, life moves too fast for 20-year generations. Now, a new niche is born with every decade.)

A student of her own generation since adolescence (at 16 she wrote a book about it, “Teens Speak Out”), Buckingham culls her insight from 1,500 trendsetters in 15 countries, dozens of insiders in music, publishing, movies and art, 500 annual focus groups and the occasional psychologist or anthropologist.

“Gen X, I always sort of think about as a group of people who went through their midlife crisis 20 years too early,” she says. “There was a lot of instability in their world ... the biggest divorce rate ever, the hole in the ozone, lead in the water, the world is falling apart -- this was pre-recycling -- nothing we can do about it, AIDS. They’re supposed to be the product of the ‘free love’ generation and can do whatever they want. Oh. You’re going to have sex and die.... [They thought], ‘We’re going to have these great jobs! We’re going to make a million dollars overnight!’ And suddenly the recession hits and you can’t even get a job. So that was where I think a lot of the slacker idea came from. It was like, ‘I just don’t know who to believe anymore.’ ”

Advertising, then, must appeal to them on a very human, sincere level. They want a brand to share their sense of humor, even their cynicism. Volkswagen and Apple are especially gifted, Buckingham says, at identifying their audience’s quirks and inspirations. Think: the grooving silhouettes of the iPod ads, or the eager husband dragging his wife out of bed to show off his Passat’s power windows.

With Gen Y, however, the approach is very different. For one thing, these kids are considered an advertiser’s dream. Born into a boom time, they’re optimists. Their parents devoted more time (perhaps too much) to parenting, creating a group of high achievers. Positive societal shifts, such as the move to get guns out of schools and increased environmental awareness, infused them with a sense that anything is possible.

At the same time, they’ve never known a world that was not saturated by media. So as long as a commercial message is entertaining, they’ll embrace it. In focus groups, they revere clever advertising as an art form. And best of all, the kids of Gen Y have no qualms about getting involved in marketing themselves. They gamely pitch product to one another, provided they get something out of the deal.

“They’re the group who got medals or trophies just for showing up,” says Buckingham. “You didn’t have to win the soccer game, you just had to show up.... Everybody’s great! So it is this wonderfully entitled, happy, hopeful generation who really believes the best in things.”

Beyond ‘embedding’

Psychology and anthropology have helped advertisers sell product for nearly a century. Sigmund Freud’s nephew, Edward Bernays, pioneered public relations in the 1920s by employing the social sciences, and in his 1957 classic “The Hidden Persuaders,” Vance Packard detailed the use of “mass psychoanalysis” in advertising. But today, the depth of analysis is more intense than ever.

“You have to connect on a level that previously you didn’t have to because your product was just a better product,” says Buckingham. “You cleaned better. You did better. Now they all do the same thing.”

And the stakes have never been so high. During the last decade, advertisers have watched the effectiveness of the TV commercial rapidly diminish as media outlets multiplied and technology advanced. Cable, the Internet, pay-per-view TV, DVDs and video games have gradually siphoned off the mass audience. And when TiVo hit five years ago, everyone declared the 30-second spot dead.

“The tools [advertisers have] used in the past are not generating the return they used to generate,” says Jeff Hicks of Crispin Porter + Bogusky, a Miami ad agency. “A great statistic I love to recite to people is that 20 years ago it took three commercials to reach 80% of the U.S. population. Today it takes 150.”

But saturation alone does little to sell product, he says, if the message isn’t novel enough to cut through the consumer’s expert filters. Ultimately, it’s all about control. Consumers want more of it. So advertisers are creating campaigns, such as online short films or interactive games, that intrigue and entertain but never overtly sell.

Consider, an interactive ad by Hicks’ agency. It offers a webcam-ish view of a man in a chicken costume -- and garter belt -- standing in a nondescript living room ready to follow the user’s commands, from “do the hustle” to “make a sandwich.” Except for a fleeting logo as the site loads and a BK TenderCrisp link at the bottom of the page, the sponsor (Burger King) and its product (a chicken sandwich) are invisible. By the end of its first day, the site logged more than 8 million hits.

The pitch was even more oblique -- verging on hoax -- in a Mini Cooper campaign launched by Crispin Porter + Bogusky in March. A 37-page “book excerpt” of “Men of Metal: Eyewitness Accounts of Humanoid Robots” by Rowland Samuel was bound into national magazines. It read like a memoir, describing mysterious sightings of gigantic (but benevolent) robots near Oxford, England. Several grainy black-and-white photos were offered as evidence, among them shots of a Mini Cooper. Unsuspecting readers interested in buying the “book” could track down a website for the “publisher,” another by the “engineer” who created the robots, and -- after the campaign made news -- a site from the “author,” defending his research. The agency called this “interactive fiction.”

“It was wanting to create content that’s not really advertising,” Hicks says.

As technology advances, so does advertising. The Internet, with its infinite reach, interactivity and immediacy, has become a one-way window into consumer behavior, providing a record of every point-and-click, every purchase, every minute online. A survey in July suggested that online advertising will surpass that of print by 2007. This month, joined 200 other online publishers in embedding links to ads in its articles.

Cellphones, meanwhile, have become so sophisticated that they now serve as another broadcast medium. Advertisers can “tether” consumers with Internet access and product taglines in text messages, video games and streaming video. Before long we’ll be watching movie trailers on our phones and our ring tones will promote new recording artists -- in surround sound.

“Wireless is going to be huge,” says TBWAChiatDay’s chief strategy officer, Carisa Bianchi. “The penetration is just going to get greater and greater.”

Over the last generation, advertising has co-opted our culture. In the next, industry insiders say, there will be no divining one from the other. Some predict that commercial messages will so effectively connect us to one another, weaving emotion and entertainment so masterfully into the sales pitch, that we’ll use ads -- not art or music or literature -- to interpret our world. Others say that marketers will soon so easily anticipate our needs, and the goods and services that will fulfill them, that selling will be redundant. Products will speak for themselves.

And advertising will disappear.

Contact Gina Piccalo at