War leaves brand owners on the spot

While P&G says it won’t run ads around news bulletins, Britvic is pressing ahead with a launch. It seems pragmatism prevails, says Branwell Johnson

Now the conflict in Iraq has begun and harrowing combat images are appearing on television and in print, advertisers are having to make fast decisions about the scheduling of their campaigns.

Predictably the travel and leisure sector has been quick off the mark. Walt Disney Parks & Resorts has already pulled a TV campaign and says it will review the situation on Monday (March 31), while British Airways pulled its Clubworld TV ad on Saturday night. The airline is next scheduled to show the ad today and is monitoring the situation day by day. BA has changed the use of newspaper space originally booked to advertise Clubworld to give information and to direct readers to BA.com for the latest updates on flight routes.

Other sectors have shown less inclination to defer campaigns or switch copy, although in the US, MasterCard, Toyota and the Sheraton hotel group have all pulled or deferred campaigns and other companies are expected to follow.

But many advertisers will be concerned about the positioning of their spots around news bulletins. Whether it is because of lack of interest from advertisers or an editorial decision based on continuity, ITV1 will not be running any ad breaks in the middle of its News At Ten bulletin, which has been brought forward to 9pm for the duration of the war in Iraq. Channel 4 is also running fewer breaks in its news bulletins and those centre breaks that do get the go-ahead are carrying fewer ads than normal.

Procter & Gamble has already stated that it will not advertise in “any war coverage that replaces normal entertainment programming”.

Just after the outbreak of the first Gulf War in 1991, Marketing Week reported that Coca-Cola, Pepsi Cola and Nestlé had no immediate plans to change strategy (MW January 25, 1991). The same seems to be holding true now: Coca-Cola has another week of its “Txt For Music” TV advertising to run and says it has no plans to pull the campaign.

Many buyers and TV sales executives point out that, unlike the outbreak of the first Gulf War or the terrorist attacks of September 11, the current hostilities were not unexpected. Clients have accordingly drawn up strategies and launch timings factoring in a possible war. Carat broadcast planning director David Peters says: “It’s not come as a great surprise to clients and it has been more a question of ‘when’ rather than ‘if’.”

The previous Gulf War appeared to slow down the rate of advertising growth. Lorna Tilbian of Numis Securities quoting an Outlook survey said that worldwide advertising spend, including the US, which had risen 8.5 per cent in 1990, took a dip in 1991 when hostilities erupted, rising only 2.3 per cent, and then rose again in 1992 by six per cent. Advertising spend outside the US followed a similar pattern, rising 11.8 per cent in 1990, then slowing in 1991 with a 5.5 per cent increase and picking up again with a 7.5 per cent rise in 1992.

Granada, at its annual general meeting last week, forecast that advertising revenues across ITV1 and ITV2 for the first half of the year would match the performance of 12 months ago, despite Easter falling in April this year, rather than March. But it warned that war in Iraq was hitting clients’ spending plans.

TV channels are taking a flexible approach to clients wanting to postpone campaigns, although there has to be a strong case made for deferral. Peters says “It’s a case-by-case situation and they’re not adopting a ‘one size fits all’ policy.”

The packaged goods sector is expected to maintain its marketing spend. For instance Britvic Soft Drinks has a &£6.25m launch campaign lined up for the end of April for its new children’s drink Freekee Soda and category director Andrew Marsden says that, while the situation is being monitored, the launch campaign is still on course.

Radio industry insiders are particularly concerned that war will have a detrimental effect on advertising spend, given that the month of April is already looking flat, despite the presence of Easter which tends to boost revenue.

But Chrysalis Radio-owned talk radio station LBC is taking advantage of the conflict to push its services LBC 97.3 FM and LBC News with a press advertising campaign.

Newspaper insiders suggest that the threat of war has put special client projects on hold. Now that the conflict has begun, some regular advertising is likely to be lost because of editorial coverage taking up more pages. The national newspapers have been printing special overnight editions and, as one buyer points out, circulations are likely to rise, which should help to offset any drop in advertising revenue.

The war comes on top of an economic slump and it’s possible that some advertisers may try to use the hostilities as an excuse to cut marketing budgets altogether. But Lawrie Procter, commercial director for The Independent newspaper, points out: “September 11 was a great excuse to pull marketing spend, but I don’t think clients need an excuse now, as the second half of last year showed such grim trading any way.”

Media Planning Group head of broadcast Andrew Canter claims that since the last Gulf war, clients have learned not to make knee-jerk reactions: “Last time clients cut back in drastic form, but this time there is a much more pragmatic view.”

The marketing community, like the rest of the world, is hoping for a short conflict. A key date will be the delayed Budget on April 9. If by then there is no good news on the horizon for the economy – and if the war isn’t going to plan – media owners may find themselves hunkering down for a prolonged advertising slump.

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here