Mediamatic Magazine Vol. 7#3/4 Geert-Jan Strengholt 1 Jan 1994

The End of Advertising ? 1

A round table discussion

Point of departure for this issue of Mediamatic and the following discussion, is the preposition that advertising was one of the big arts of the 20th century. But will advertising make it into the next century? Is there a future for advertising? Was advertising art, and how does the new, so-called 'commercial art' relate to it? How do the media, corporate business or the marketing world respond to the changing situation?

Participants:

Ron Meijer (RM), creative director/copywriter, founder of Imagine (advertising agency)

John Thackara (JTh), director of the Netherlands Design Institute

Han Vervoorn (HV), director srm (Foundation of Advertising and Marketing Training)

Jouke Kleerebezem (JK), artist/curator/member of Mediamatic's board of directors and founder of Office for Cultural Intelligence

Paul Perry (PP), artist/sculptor, working for Triple P

Dirk van Weelden (DvW), writer/publicist and editor of Mediamatic

Willem Velthoven (WV), graphic designer and Mediamatic's editor-in-chief

Changes in Advertising

Ron Meijer: A lot is changing in advertising today, especially if you consider advertising in the classic way of 'selling products with pictures and words'. Advertising in this classical sense will not live for very much longer. However you could also see advertising as the pathway to publish uncensored whatever you want to say, whether you sell a product, run a company or a political party. If advertising is considered like this it becomes the pathway to getting your message across.

Willem Velthoven: I like your definition of advertising as companies or anyone buying media-time/space and using it to communicate whatever they want to say.

RM: There we have to make a differentiation between pa/guided communication, and free communication. Paid communication is when you pay for the fact that nobody interferes with what you want to say. And then in the end there really isn't that much difference between selling products or selling ideas.

Dirk van Weelden: Or does the fact that you advertise them turn them into products?

John Thackara: Or brands? I started thinking about this subject from the perspective of design, where you think about a certain object or a single image. The design-world has been, and generally remains, ignorant of the communication concept of the 'brand'. But if you look at the way the business operates, the designers have kind of gone round the brand, from the product to the company. The whole kind of environmental corporate identity is now a three billion-dollar industry in the world. Instead of selling the product you are selling the image and the environment of the total company. The advertising industry is basically heavily dependant on the brand, and the design-industry looks at the company as the basic unit. In the last six months there's been a sort of crisis in the financial and advertising press, about the fact that the power of the brand is diminishing. The consumers generally have become literate in communications to the extent that they now understand what a brand is, and in understanding it they now realise that the price they pay for a branded product is higher than its functional value, and they are becoming more resistant to that. Some of the Japanese say that now that brand-culture is dead, you have to go beyond the brand to the company... You get to this pseudo-science quote, like John Scully from Apple saying: Now the basic component of the modern corporation is relationships with customers, and relationship-marketing is the new tactic, replacing brand-marketing.

Han Vervoorn: It's not contradictory to brands. You can see there are logo's and trademarks even older than industry. A brand is nothing but a bundle of possible associations, so in the end there is not so much difference if you brand an idea, a firm, a country... or a multinational, which is a kind of modern power state.

JTh: But if you're brand oriented, you tend to ignore the properties of the product or the qualities of the company. In the example of Marlboro, once they had established the brand, in the end they were not really interested if they sell cigarettes or something else. But if they decide to sell Marlboro t-shirts, people start to realise that because it has Marlboro stamped on it this is going to add to the price, and they ask themselves what is better about this t-shirt that I have to pay extra for? And if you cannot provide that extra, then you can't sell the t-shirts either.

WV: The extra is the brand! So if we agree to shift to relationship-marketing, can the brand be an extra for much longer? What about these Mugi-shops, these Japanese no-brand shops.... do they advertise? Mugi is a big hit in Japan, now opening up shops in Europe, selling products with no brand. The name actually means 'No-Brand'. They sell generic stuff for very high prices. This is marketed as high design, but the Mugi t-shirt is recognised simply because it doesn't say anything. It's a brand, where the added value is no-brand...!This is very funny, since Japan is such a very brand oriented, consumerist market.

JTh: I did an interview with someone at Seibu, who was panicking about the death of the brand...He is worried about dying brands. But didn't we simply overdo it with these brands. As a consumer I get tired because every shop has a concept. I mean you can hardly walk into a shop without being confronted with all this theme-stuff... Green shops, Eco-shops etc. You get tired of it. Which is why half of them is now bankrupt. Because that kind of communication-driven marketing has lost its power to work. At first it was very effective, but when everybody started doing mass-reproduction of a shop, advertising and packaging, then merchandising the whole thing became selfcancelling.

Changes in Marketing

WV: So what are the consequences for the way of advertising? Okay, we're no longer advertising products, we are advertising relationships, but does this actually change the way you market?

DvW: The whole idea of image or logo has become immaterial; its not important what kind of logo you have, if it's not marketed through mass communications. Relationship marketing is a private thing. Most brands were marketed in the public domain, and relationship-marketing tends to disappear from that area. But the brand also makes itself loose from material manifestations of advertising.

HV: Of course, the production of most companies becomes immaterial. Only in Europe 40% of production is material, 60% is producing services and ideas. But even relationship marketing is a way to get a brand known. Advertising is actually the wrong word to discuss here, because it's a word of the past. We should, as Ron pointed out, talk about the concept of advertising as communication.

JTh: Communication is a much more accurate description, more sophisticated. Big agencies use words like orchestration, in the sense of organising all the different ways companies communicate with customers or employees. There are lists of possibilities of which media-advertising is only one element. It's only in the recent period that they have not been dominated by the notions of mass communication, and of the mass-audience as being the mass product. Isn't that what's changing? At the same time the technology of production is changing, becoming more fragmented, the technology of communication is becoming more fragmented, and then the market and the people who receive all these messages are becoming more differentiated and expert. So there the concept that the message can be broadbanded and emitted in one direction to consumers, that is what is under question.

RM: Toffler notes something interesting in his new book Powershift. Marketing became institutionalised after the war and the notion was developed that marketing should be technocratic. You can't do marketing in small family businesses... Toffler in his Powershift is observing that small companies and family companies are growing again... so it's a kind of post marketing development. The dictate of marketing and everything being already marketed before it even appears is changing.

HV: It's interesting to note that the basic trends are moving away from techniques, marketing-techniques, management techniques etc. And they're all heading for embodiment and envisioning...

DvW :They all try to internalise the situation in which they want to have an effect...almost as a state of mind, not as an action. That is why mass-advertising is mainly a statistical rationalised technique; you know what kind of people are interested in this and how to approach them... and afterwards you see if the effect is sufficient or not. When you think of leaving technique you have to go to the situation, where the product is used. Like the cigarette-company who sent people out, into the nightlife to mingle with the consumers.

JTh: Which is why they are writing books on ethics and business; like on cities or companies which succeed economically because of a sort of common value system. Ethical consultancy to business on how to be good and all, is developing into a business of its own.

HV: This is the biggest change in advertising... Companies are presenting their story on network tv and see if the public is interested. They hope to attract people by telling a good story. They're not selling messages to mass audiences, it's more like... this is my story... are you interested? That's what communication is all about. Advertising as such was not communication at all, it was a one-way street.

Art-Business / Business-Art

WV: So, gentlemen-artists, what does art think about communication, what kind of communication is art itself? If you look at the history of art, in Europe at least, it starts as a straightforward communication instrument; the communication of religious images and ideas. Telling the story of the bible to the illiterate. Art as a propaganda instrument is much older than advertising. It was a communication-instrument of power. From there art has taken a very strange bent, and it evolved into something more withdrawn.

Jouke Kleerebezem: What could be a critique on art, is the splendid isolation. I'm seriously wondering whether art is communication. After art lost its primary function in society, it changed into this struggle, see the history of modern art. It was basically a retreat into the realm of art itself, and not dealing directly with other parts of society anymore. Now art is looking for new relationships... the most interesting development in contemporary art as far as I'm concerned.

RM : An interesting thing is that some ten years ago advertising was borrowing from art, now we see art borrowing an incredible lot from advertising. Rob Scholte and others are replicating, changing nothing adding only the labels.

JK : They are changing the context! Doing what Duchamp did. Artists have been using advertising-materials since the twenties, Dada, Schwitters etc. have used the material, but not the communication-techniques. A lot of artists, like the ones in Business-art/Art-business, think they are very clever using advertising.

RM: The technique of using pictures and words, interacting with each other to get across something, developed with advertising. This is used in art now.

DvW: So what does this tell us? Is it a sign of decadence? Of desperation?

JTh: One aspect of the interpretation of art is that the artist wishes to make a statement, and isn't so concerned about the effect of that statement. A kind of representing an idea, a point, a feeling and to some extent the reaction of the audience is contingent in that it doesn't matter so much. Whereas the advertising process is about changing behaviour and attitudes, and so therefore advertising by definition gets a sort of feedback.

DvW: So it's a nostalgic problem. Does this incorporation of advertising techniques represent some sort of nostalgia on the part of the artist, of his lost influence, his lost connection to society? He would like to change behaviour, but there's nothing like advertising to envision it, so then they start to make artworks for companies, which is a way to change behaviour, which is what they are called in to do.

RM: John makes a distinction there... Advertising is interested in the effect and the artist wants to make a statement and was not primarily interested in the effect. I think the artists who are now using these techniques are utterly interested in the effect.

JTh: Either that or they have become aware that advertising permeates our environment, and that in the sense that they are not living in an abstraction; if they want to comment on the world as it exists, then they have to comment on advertising as well.

Paul Perry: Culture is our nature, as they say.

JTh: And our nurture!

WV: Still this so-called business-art is not trying to deal with society, as far as I can see. These artists posing as businessmen and so-on. They only present their businesses in art-departments. These artist/companies are not real, they are sniffing on their own historical functions. I don' t know if they really want to be a company at all.

JK: But there is a difference between artists like Servaas, who run a studio, a one man business without having the burden of running a business, and artists like Rob Scholte who has the burden of running a business. Running a business or posing as such makes a difference. The artists trying to run a business are more interesting than the guys saying okay now I'm a business. That makes no impact on the way of conducting business.

JTh: What about artists working for companies? Like Absolut Vodka who hires artists to make images with vodka-bottles in it. What is that, art? Or is it advertising? I think it probably is.

The End of Mass?

JTh: The whole approach of the luxury industry of marketing all parts together - where you have the communication, the packaging, the bottle - that is actually a 19th century phenomenon, so nothing is ever new. I think there's a lot to be said about those companies that really integrated the objects of their communications and their environments. I think they have a lot to teach the companies that are interested in that now. Whether that is art I don't really know, maybe it doesn't matter. It is certainly quite a sophisticated business. They created a kind of specialised, small-scale environment, which is where we're going... away from the mass market towards specialised production of goods and services, towards mass-customisation.

HV: The ultimate aim is to keep the benefits of mass production and at the same time servicing your clients on an individual basis. So mass-customised servicing or production is a way to fit these two together. This relates to computer-integrated manufacturing. The more flexible it becomes, the easier it becomes to do it.

WV : That's basically customer driven differentiation.

JTh: We have still got mass production all over the world, whereas we have capacity for very much more flexible individual mass production. It's just a question of investment and we could actually have global specialised production today, if we were to started from scratch. Its just that it is not possible to make that transition, with all these companies going bust.

HV: I predict that within five years you enter a shop, you are physically scanned, you can design your own stuff on a screen and within 24 hours your product is produced in a mass-factory.

WV: But would you really expect your client to design his own stuff?

DvW: No, they just run into the menu....Wham! But that's the whole problem about this concept of communication..., the word communication sounds real free and uncensored, but it's just victims running into the menu of sales-people. They have set up the menu, all different types of individuals clash into it, and everything not interacting with the menu is dismissed as irrelevant. In the menu one can only make contact with categories that the producers have set up. It determines the way the consumer is individually approached... So it has nothing to do with let's say a humane idea of communication. It's just another way of selling material things.

HV: The biggest change in advertising is that it is loosing its instrumental value. In the future people will not be seduced so easily by simple tricks like that.

PP: I stumbled over what Han just mentioned, the benefits of mass-production...? Willem wrote that advertising as a 20th century art has served it's purposes and will now quietly fade away... and I wonder whether this notion of mass-production will also quietly fade... Basically we're talking about a shift in paradigm in terms of communication, so can we not question these so-called benefits of mass-production?

RM : They are rather obvious... people that own capital want a multiplication of money coming in with as little effort as possible. So they are not interested in selling product by product, unless they have a production system in which they don't care anymore. If technique enables to make, instead of 100.000 the same products 100.000 different products they will do it. At the same speed and to the same costs of course... or lower!

JTh: Its not a question of good or bad, it's more a question of who benefits from the ability to produce things in large quantities. Now that benefit is being reduced... and the irony is that the pressure is to add more and more value to the product, to get more specialised, exotic cars for example when actually the consumers or the people in most of these industrial societies would benefit quite well from mass-produced cars that are all exactly the same... But there is no profit in it. So there's a political and an economic contradiction. Totalitarianism has always offered mass-production as a social benefit. That is in part the crisis in the consumer-electronics industry... The whole structure of the business is based on that you invest in research and technology and then you put the technology into a box and sell the box at five or ten times its production value. And the trouble is that, and which is how industrialisation worked for much like the last hundred years...the trouble is now that this has spiral-effect on the speed with which other people pick up the same technology to make a product at half the price, or the speed with which a new technology makes that one obsolete. The space in which you extract value and profit from your business is disappearing, which is why the people who make hardware are just all going into this crisis. And that's, theoretically, why digital technologies are profitable because it costs no more to change software... reproduction is not the cost, which is why these companies are not in crisis.

Mass versus Individual Marketing

RM: We should not overestimate individualism. We are talking about differentiation, fragmentation and individualisation - smaller groups -, that people also have tendencies to be different from other people - but they also like to belong to groups. When I, from my office have to convince someone not to use direct marketing, which is very personal, but should use advertising... I always take the example, that if you offer someone to buy a Rolex of 10.000 by mail, he will not take it if he does not realise that all his neighbours know that a Rolex is a very expensive watch, because then it is not worth the money. However if I buy wine, direct marketing works very well, because I want very good wine and... a wine that nobody else has. You can come up with a whole spectrum of products and they are all different in whether they want to be consumed in a broad network or very specialised, with everything in between... And then you have all the different groups, even in electronics, of people who want to belong and those who want to be different... I don't think this will change very much.

JTh: You talk about community and social interaction and all of that... but basically the logic of the advertising industry is not how to create social events...

RM : That is changing... you mentioned Apple... the most famous commercials for Apple are not about their machines...

JTh: It is certainly about something more than products, but it still is basically a visual one-way communication. I read this thing about Hermès, who make bags and scarves. Their whole ethos is set about the image of luxury, the image of beautiful shops and high price products. They have now experimented through direct mail with organising Hermès parties, where people sell each other scarves and things and their sales have gone up 300%. They don't need the shops any more. The social interaction happens in private places, where we are all rich together...

RM : Even Tupperware is still successful with the same old technique.

JTh : This whole question of peer groups is very interesting...I attended two conferences in the us on sponsorship, where I was under the expectation that they would be concerned with special interest groups, where you identify all the people in the world who like dogsled racing or bungie jumping... However for the marketing people it is not important that they have a list with people with special interest, it's the fact that these people have a special interest that they share in a social environment. It all has to do with peer group, word of mouth, interaction between people that are not trying to sell each other something! This is an argument against direct marketing where people have no social interaction, no social experience, so it's not that powerful. In the next station of marketing/advertising we will not define groups by consumption but by communication.

See for continuation of this text: The End of Advertising? 2