Sunday, October 03, 2004

:: adgruntie :: Infomercial and results

+ The infomercial infomercial turns 20 this year. The Seattle Times gives us a little history to the cheesy, shilly ads. "Veg-O-Matic daddy Ron Popeil, often thought of as the father of the infomercial, first bought 60-second television commercials in the 1950s. But until 1984, the Federal Communications Commission did not allow more than 16 minutes of advertising per hour, with two-minute spots the maximum length."

+ Agency only gets paid when it gets results.
The Intelligence Agency's fees are dependent on the success of the advertising and marketing campaigns it designs for clients. "This is a business that's far too fuzzy," says Luke Haase, a former Detroit-area public relations executive who moved north and started the firm in 1999. "We don't get paid for doing stuff. We get paid for results."

Haase's firm appears to thrive during a gut-wrenching time for advertising agencies. Clients are becoming increasingly fed up with costly advertising campaigns that fail to boost revenues. They want to see tangible results. This drive for accountability is giving many big ad agencies major heartburn. Agencies have had to cut their prized 15 percent commissions and lay off thousands of workers.

While ad agencies may not have fully adopted pay-for-performance plans, they're sharing more financial risks with their clients, Vanden Bergh says.
It's definitely a different idea, although I'm not sure that it's one that will catch on. But who knows.

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