Martin Sorrell's View of the Key Developments Facing Advertisers and Media Firms

Martin Sorrell, who grew up and lives in the UK, is head of WPP, the largest marketing-communication conglomerate. As such it decides which media firms to support around the world. List list is from "Jack Myers’ Think Tank," a newsletter. Meyers evidently got it from a speech Sorrell recently gave.

1. Global Shifts in economic, political, social and cultural power.
2. Continuing Auto Production Capacity and the under-capacity of people/customers. While U.S. auto capacity has declined, the capacity in China and India has expanded. Over capacity of supply and under capacity in the supply of people makes the role of agencies and marketing even more important.
3. The Web. The reason the Consumer Electronics Show is important is that the tech companies are now media owners. The Web disintermediates legacy players and is a more attractive destination for talent.
4. Internal Communications. Communicating strategic and structural change is an internal challenge for organizations as much as -- or more than -- an external challenge.
5. Retail Power. Major retailers are gaining power, especially when there is little inflation. Retail companies put pressure on manufacturers, pushing companies like P&G into direct consumer marketing through websites.
6. Global Centralization. As companies expand and gain global influence, they are integrating their organizations at the center.
7. Procurement and rise of the finance function puts more emphasis on cost management.
8. Governments, as both regulators and as clients.
9. Corporate social responsibility. Doing good is good business.
10. Content. We have to think about content in the context of how business is fundamentally changing. Consumers have to pay for content. There is not enough advertising to finance the business models of all the new media. There needs to be more consolidation for the health and development of the media business. State subsidies have to play a greater role to maintain professional journalism.

- From Jack Meyers, "Sir Martin Sorrell's Ten Priorities for Media, Agencies and Advertisers," From Jack Meyers Think Tank, February 1, 2010.

Crowd-sourced radio

A company called Jelli creates a crowd-sourced radio format. "Listeners can vote on audio content in real-time at the station's Web site . . . or by downloading Jelli's iPhone app. The Jelli system lets users push a song to the top of the playlist by voting that it "rocks," or vote a song off the playlist by voting that it "sucks." If enough people vote a song down, it may even be yanked off the air in mid-tune. Jelli rewards listener engagement and loyalty by giving frequent users extra-powerful votes in the form of "Rockets" and "Bombs."

A recent station to introduce the format is Clear Channel's WKLS in Atlanta, from 7pm to midnight.

From Erik Sass, "Jelli Enters Atlanta Radio Market," Media Daily News, January 19, 2011.

Are Traditional Book Publishers Obsolete?

Matt Shatz argues they might well be. In the digital world, "self-publishing" through sites such as Amazon may be more useful than going through a traditional publisher such as Random House. Those sites know lots about their visitors and can send suggestions of appropriate titles to the right people, Shatz points out. If traditional publishers don't figure out ways to learn about their target audiences, they will be at the mercy of web distributors such as Amazon.

See Matt Shatz, "Why Online Retailers Will Squeeze Out Publishers in the Book Business," PaidContent.org, January 18, 2011.

The Net Neutrality Furor

PaidContent.org has a useful summary of the furor from the left and the right over the FCC's recent decision on "net neutrality." That is the idea that internet service providers must not show preferences to certain websites by degrading or sling down other websites. Some critics are angry that the FCC passed a ruling of this sort at all. Other critics of the ruling say it didn't go far enough to protect internet competition and the rights of consumers.

See Joe Mullin, "FCC Pushes Through Net Neutrality—And Draws Fire From Right And Left," PaidContent.org, December 21, 2010.

How the Venerable Atlantic Changed for the Digital Age

The Atlantic, an issues-oriented magazine that was founded 153 years and in recent years has been a consistent money loser, is on track to turn a tidy profit of $1.8 million this year. Jeremy Peters of The New York Times suggests that the reason the magazine has turned itself around relates to a decision of its young management to attach their property to the web enthusiastically at a time when major magazine firms were still wary about hurting their print product. So, for example, in a move rare in the magazine industry the publisher told the advertising sales staff that it did not matter whether they sold ads for the digital or printed edition.

The Atlantic reduced its staff and made other monetary accommodations that are allowing it to prosper in the digital world. Moreover, Peters notes that this periodical with less than half a million circulation and an entire business and editorial staff of about one hundred can break even at levels lower than the big magazines produced by the likes of Time and Conde Nast. Nevertheless, the developments point to the activities periodicals must consider to survive in the new media environment.

From Jeremy W. Peters, "Web Focus Helps Revitalize the Atlantic," New York Times, December 12, 2010. Thanks for Scott Weiss of St. Francis College for suggesting this piece for the blog.

Drugs, Tweets, and Responsibility

The Food and Drug Adminiistration (FDA) requires pharmaceutical firms to make sure that when drugs are "promoted" to the public "statements stick to approved uses for drugs only and maintain a “fair balance” of information about their risks and benefits." The actual rules about this can get complex in today's world, where there are so many ways that people can learn about medicines.

"For example, the 'social' part of social media means that third parties — bloggers, commenters, Twitter users — are also part of the message. (Kanye West tweeted this summer that 'clothes are my drug,' but what if he’d instead said that Lipitor was his drug? Should the FDA pay any attention to that? What if he or another celebrity were paid for the tweet?"

Two Boston physicians recently suggested that "To maintain a fair balance of benefit and risk information, the FDA might 'try to ban pharmaceutical promotion entirely from these media.'"

From: Katherine Hobson, "Who’s Responsible for Tweets About a Drug," Wall Street Journal, November 26, 2010.

"The Grass Horse Has Been Harmonized"

Recently, Chinese government authorities a cancelled a conference for bloggers in Shaghai. Blogging is wildly popular in China, which has the largest number of internet users in the world. But a small percentage of bloggers discuss politics critically, and that annoys authorities. Some bloggers have been arrested and are serving prison time.

When the conference website was shut down, "organizers found a way to poke fun at censors: when visitors to the conference's censored home page pressed Ctrl-A—the common computer command for 'select all'—it highlighted previously hidden text that read, in Chinese, 'The grass mud horse has been harmonized.' Grass mud horse is a famous anticensorship pun in China's Internet world—its characters form a homophone for an obscene phrase—and 'harmonize' is a euphemism for censorship, playing off President Hu Jintao's longstanding campaign to create a 'harmonious society.'

See Juliet Ye and Jason Dean,"China Blogger Conference Is Canceled Under Pressure," Wall Street Journal, November 21, 2010.