Broadcasting Telecasting (Oct-Dec 1959)

MONDAY MEMO from WILLIAM W. NEAL, , president, Liller, Neal, Battle & Lindsey Inc., Atlanta Advertising role is a two-way street The following is a condensation of Mr. Neal's talk to NAB's fall meet in Atlanta Oct. 30: First, I want to talk about the importance of advertising itself. I'm talking about all advertising, so for a few minutes let's forget the competitive aspects of the business. Advertising is bigger than all of us — thank heavens — or the broadcasting share couldn't be nearly as great as it is. Some of you who keep your noses too close to the microphone may not realize that over $10 billion was spent in all advertising last year. About $2 billion was spent in radio and television ■ — almost exactly 20% of the grand total. Ten billion dollars is a lot of money, but America is a big country. Last year our gross national product amounted to $441 billion. For about 2.3% of that total spent in advertising we moved the mountains of merchandise that America's factories and America's highpriced workers produced. For the first time since the depression years of 1930 total advertising failed to show an increase over the preceding year, but the drop in total was not significant, amounting only to about 1%. Broadcast advertising, on the other hand, increased its share of the total, and its grand total, by over $50 million. The Major Role • I mention these figures for one reason only. I hope they will help us to forget our own little problems, for the time being at least, and remind us of the part we play in a great American business. Henry Schachte, of Lever Bros., has a good description of advertising's problem. He says, "Advertising is expected to move millions of people and moutains of merchandise." Our machinery for production of merchandise has become so gigantic that advertising is being asked to create all the demand that can be generated. There's no question about our ability to produce; the only question is how much can we sell. And how well we advertise is largely the answer to the question of how well we can sell. Even the most conservative economists forecast a great growth for the American economy in the years ahead — barring some unpredictable holocaust. If our economy is to grow, if our production is to grow, our advertising must grow, too, to help build the great market for the products our factories must build. America's free enterprise system is built around advertising and the principles for which advertising stands. Let America's factories build what they can and what they will — let them offer their wares through advertising — and let the American people take their choice. There is little place for advertising in a controlled economy. The only controlled economy we have ever known was one brought on by a severe national emergency. Advertising does more than develop direct sales. It encourages a better way of life. It tells people of new products, and new uses for old products. It adds to America's standard of living. And broadcasting does all the jobs we have mentioned for advertising and more. In the battle of rates and ratings and personalities and other short-range problems, let's don't forget the longrange picture. The long-range picture William W. Neal b. 1908 Kernersville, N.C. Received A.B. 1928 U. of North Carolina. Phi Beta Kappa. Joined advertising department of Southern Bell Telephone, Atlanta, and later worked with various Atlanta advertising agencies before joining with C. K. Liller and James L. Battle , in 1940 to form own agency of which he now is president. Agency merged in 1958 with Lindsey & Co., Richmond, to form Liller, Neal, Battle & Lindsey. is bright. Advertising is certain to grow ■ — as certain to grow as the American economy. Advertising has a great job to do and advertising is too big a business to become involved in unpleasant and distasteful compromises. Mutual Understanding • The second point I want to suggest is that the broadcasting industry and the advertising agencies of America strive for a better understanding of each other. I fully recognize that understanding is a two-way street and that agencies must play their part if worthwhile progress is to be made. In our agency, and I know scores, literally hundreds, of others with the same attitude, we study the criticism of agencies made by media and do our best to see that these things don't happen in our offices. Our media people are instructed to give every media man a fair hearing. Our account men see media people regularly and gladly. An agency is not a parasite living on the 15% commission which some of you still grant us. An agency doesn't stand between you and the order. We don't make a dime when we don't spend a client's money. An agency does spend hours, days and often months preparing the material that goes into the time you sell us. Even before an agency gets to the point of writing a word, weeks and months are spent studying the client's products, his markets and his problems. There should really be no great problem in developing a better mediaagency relationship. You must develop an audience for your station if you are to sell time. We must develop an audience for our client if we are to sell merchandise or services or ideas. Needed: Stable Rates • And now my third point: the need for more stable rate structures. This is a discussion that has no meaning for many of you, but the abuses are sufficiently widespread that I think they need to be brought into the open. In entirely too many cases, published rates have absolutely no significance. They have been replaced by the telephone call or the personal visit or the confidential letter. Please don't consider that I am suggesting lower rates or higher rates. That has no place in this discussion. I am merely pointing out the great advantages of a stable rate structure to an agency and to the whole advertising industry. BROADCASTING, November 2, 1959 29