On Friday the latest doomsday threat out of Washington became a reality as automatic federal budget cuts, known as sequestration, went into effect. What effect that will have, we can’t be sure. The latest round of debates between Congress and the White House was full of rhetoric and classic “we said, they said” as politicians “discussed” what across-the-board cuts to government agencies and defense spending would mean for the average American. But for most of us – including those of us in the advertising industry – it is a “wait and see” situation, since we likely will not know the true impact of the cuts for a while.
For the advertising industry specifically, sequestration brings with it many unknowns: whether or how the cuts will impact the industry, if the cuts will be reflected in the greater economy and negatively impact the recovery, or if regulation and innovation will stall. We will all be anticipating what the real impacts of sequestration may be on advertisers and marketers – and how cuts will shape critical public issues across the board.
The Way I See It
• I see the advertising industry only continuing to evolve with digital and mobile, interactions with consumers, and data, not to mention new technology being developed nearly every day. While industry self-regulation on major issues like advertising to children, online privacy, and data collection by apps is strong, government agencies including the FTC have only begun ramping up crucial regulatory and enforcement efforts of the advertising industry. It will be interesting to see whether this is impacted by sequestration – will other critical issues take precedence over issues impacting the advertising industry?
• We can safely predict government agencies will cut ad spending, but it is unclear whether large brands or advertisers will feel a pinch across the board. Advertising Age reported earlier this week that ad agencies that count government agencies – such as the U.S. Postal Service and the Army, the government’s top-two largest ad spenders – as clients will feel the pinch. And the agencies will see an impact in ROI from decreasing marketing. Take these budget cuts as opposed to the investment announced by NYC Mayor Bloomberg in a new initiative and marketing campaign dubbed “Made in NY” to support the booming startup scene. I see Silicon Alley and NYC on the whole seeing a great ROI from this initiative, with startups seeing more value in coming to NY thus supporting the local economy, growing tourism, and adding jobs.Continue Reading What Does Sequestration Mean for Ad Land?


February 1st was a big day for the Federal Trade Commission (FTC). Not only did the FTC release its report regarding mobile privacy disclosures, it also announced that it had reached a settlement with Path, a social networking app, which agreed to pay $800,000 to settle charges that it deceived users by collecting personal information from their mobile address books without their knowledge and consent, and that it collected personal information from children without their parents’ consent in violation of the Children’s Online Privacy Protection Act (COPPA).
I sat down with Jeff Klein, Senior Director of Marketing at Frito-Lay to discuss advertising during the Super Bowl and the importance of the NFL’s biggest game for the advertising industry.
Guess what? When it comes to the claims you make in your advertising, substantiation matters – a lot. The FTC’s recent Final Order against POM Wonderful (POM) in which it found nearly 40 claims made by POM about its pomegranate juice products to be false and misleading based on the absence of proper substantiation, should leave no doubt that the FTC takes the issue of claim support very seriously. And the fact that most of POM’s challenged claims – claims regarding potential health benefits of the products, including that consumption could help treat, prevent, or reduce the risk of heart disease, prostate cancer, or erectile dysfunction – were not actually express claims, but rather implied claims (from both the wording and imagery of the ad), should be a reminder to us all that the entire advertisement and the overall “net impression” it conveys must be carefully considered.






