Will Madison Avenue Be Bushwhacked?

Now that the election is over, the ad industry is sorting out what a second Bush term means for Madison Avenue. The overarching question: How will the moral-values agenda affect key ad categories and the shows that advertisers sponsor, a several billion-dollar haul for TV?

For openers, indecency and violence are going to get “a searchlight of attention,” warns Dan Jaffe, senior vice president and head of the Washington office of the Association of National Advertisers (ANA).

Advertisers aren't taking chances. To escape scrutiny, they will continue to embrace wholesome fare, like Gilmore Girls, 8 Simple Rules and American Dreams. All were initiated by the ANA Family Friendly Programming Forum, notes Brian Wieser, vice president and director of industry analysis at Magna Global USA. The media-buying unit for Interpublic Group's ad agencies just released a report outlining the potential economic implications of the Bush victory.

Wieser believes a moral groundswell could have a chilling effect on sponsorship of questionable content, such as new media aimed at the gay and lesbian community, including Viacom's new Logo network. While he believes Madison Avenue would resist overt pressures, recognizing the viability of the gay and lesbian market, the moral agenda might frighten on-the-fence advertisers.

Many also believe that the Bush Administration's stance on media ownership will negatively impact Madison Avenue. “The common wisdom is that Bush would be better for business overall and, therefore, better for the ad business. But I would go the other way,” says Jon Mandel, chairman of Grey Worldwide's MediaCom USA media-buying unit. “The feeling is that the Bush FCC will let the media industry do anything it wants. That could backfire for us by contributing to even greater industry consolidation.”

Mandel, who led a Madison Avenue lobby against media consolidation last year, believes mega-mergers dilute program diversity. The concentration of ownership stifles the variety of media content, which, in turn, limits the ability of marketers to efficiently reach targeted audiences that favor niche programming. Advocacy groups have also challenged the legitimacy of product placement, which may emerge as an implied area of regulation in the new term.

Another trouble spot: The FTC may start ruling on the viability of specific ad categories. Ad executives believe the primary targets continue to be prescription-drug advertising and food advertising targeted at children. “Prescription drugs account for approximately 5%, or $1.5 billion of TV advertising. So any regulations that emerge would have a significant effect on this medium,” Wieser warned in his report.

Although Bush is considered somewhat moderate on the drug spots, he won't remove them from the threat list. And he's expected to sign off on any legislation. ANA's Jaffe says Bush's reelection does not remove the threat of regulations on prescription-drug advertising, but reduces it “slightly.” He added the Kerry/Edwards team had indicated much stronger opposition to the ad category, particularly the direct-to-consumer ads for such products as Claritin and Viagra.

A more immediate threat appears to be TV advertising for food products aimed at children, especially fast-food marketers like McDonald's, Burger King and Frito-Lay. This issue is on the agenda in the White House and on Capitol Hill—a rare one shared by Republicans and Democrats alike.

Any challenge to food commercials is a significant threat to children's-TV programmers on broadcast and cable, says Jaffe, because food is now the No. 1 ad category on children's television. Without it, some kids shows may not survive.

Wieser isn't panicking yet, claiming the outcome may not be nearly as severe as fears of removing the category altogether. “The solution might be as simple as using media plans to target adults more efficiently or by running commercials aimed at adults in children's programming,” he says.

For now, advertisers and their agencies are playing it safe, bracing for a new social agenda. “Where we might end up seeing this come to light is in prime time,” says Steve Farella, president and CEO of media agency Targetcast TCM. “Just take a look at what Disney's The Incredibles did its first weekend. In two days, it grossed $70 million, and yet a family can't find a half-hour of programming in prime time they can watch together.”