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"FREEDOM MUST ADVERTISE"

(An address delivered by Tom Dillon in 1963 and updated in 1976)


What does advertising contribute to the world? Are we advertising men, as many people think, an expensive parasite on the social structure? You will not need to look far to find that point of view expressed.

And it would be odd, indeed, if everyone in advertising had not at some time or another wondered whether he was wasting his skills and his life in a meaningless exercise.

How, we may be asked, is mankind served by our efforts to show that this miracle suds gets your clothes whiter than that miracle suds?


"...they say, wicked advertising people
are so manipulating the public
mind that spiritual values are
being replaced by materialism..."

Why, the critics say, $28 billion every year is wasted in advertising - $28 billion that could better be used to rebuild the school system of America!

Furthermore, they say, wicked advertising people are so manipulating the public mind that spiritual values are being replaced by materialism and the shabby doodads of a tail-fin economy.

Let's take a few of these garlands of roses and look at them. Let's look at the great big $28 billion hole in our economy that is made by advertising.

In the first place, it frequently amazes people to learn that in the last 54 years the percentage of the gross national product of this country spent on advertising has not increased. Whatever hole advertising makes in our economy, it is now no larger a hole proportionately than it was in 1925. It may make advertising people feel good and some other people feel bad to talk about the growing factor of advertising in our economy. The plain fact is that it is not a growing factor.

It also makes some of our agency people feel happy to talk about being in a $28 billion industry.


"The fact remains that
$28 billion is a lot of money,
and it's being spent
on advertising."

Well, unfortunately for us, the advertising-agency business is only an $11-billion industry. And in this $11-billion industry, advertising agencies siphon off only 15 per cent, or some 2 billion.

But it is all very well to say that advertising agencies handle less than half of all advertising. The fact remains that $28 billion is a lot of money, and it's being spent on advertising.

Or is it being spent on advertising?

Here we come to one of those little tricks that are used intentionally or unintentionally by people to confuse an issue. It consists of counting the same figure twice. Of course, any of the $28 billion that goes into advertising-agency income, outdoor advertising or into direct mail is spent on pure advertising. But agency income, outdoor and direct mail are about 21% of total advertising.

After that, what happens when you spend a dollar for example, on TV advertising? Where does the dollar go? Probably not more than a nickel of it goes into producing the commercial and into the electrical energy that transmits it to your TV set. What becomes of the other 95 cents? It goes, of course, into the cost of programming and operating television stations.

So you see that the $28 billion spent in advertising also includes, as part of the $28 billion, the entire cost of running all the radio and TV networks in the United States and all the 7,526 individual radio and TV stations.

Let's look at newspapers. Probably most people feel that they are paying for their newspaper when they lay out their 20 cents. Of course, they are not. A city newspaper is lucky if its circulation revenue pays for those big rolls of white paper that the news is printed on. Everything else - the entire cost of worldwide and local news gathering, pictures, features, the actual engraving, typesetting and printing of the paper - has to be borne by local and national advertising.


"So when your doctor reads
'The Journal of the American
Medical Association', that
communication is brought to him
through the courtesy of advertising."

And there, for the support of 1,819 daily and 8,824 weekly newspapers in the United States, goes another part of that $28 billion.

Now, let's take the magazines - 9,872 consumer, trade and technical. Those subscription prices which are offered to tantalizingly just about pay for the cost of rounding up subscriptions and putting the postage on the magazines. So when your doctor reads "The Journal of the American Medical Association", that communication is brought to him through the courtesy of advertising. And that scientist working out in the Point Mugu missile center - his copy of "Aviation Week and Space Technology" is brought to him paid by advertising.

If you'd like to try a little mental experiment, imagine that instead of the seven New York newspapers that were struck years ago, the advertising industry had been struck.

Who now will pay for the Associated Press correspondent in Moscow? Who will now pay for Walter Cronkite? Who pays for the coverage of the political campaigns?

After about 60 days I assure you that no one will. Most publications would have to stop after the first issue, and very few could go for more than a few weeks. Radio, TV, magazines and newspapers in this country would have to go dead for lack of income.


"...advertising pays the bulk
of the cost of communications."

For, you see, there really is no such thing as a 28-billion advertising industry. The cost of advertising overlaps the cost of a communications system that covers the whole United States. The cost of preparing and producing the advertising is a relatively small fraction of it; but advertising pays the bulk of the cost of communications.

Now, what would happen if, in the long run, there were no advertising industry and people simply paid more for their publications? It would be a good guess that The New York Sunday Times would probably cost $6 or $7 an issue and the daily edition $1 or $1.50, even after it had been cut down because of the elimination of advertising.

It's really not necessary to guess what would happen if there were no advertising because there are other countries in the world in which advertising does not play the part in the economy that it does in the United States. What happens in their internal communications systems?

Some countries, like Great Britain and Canada, have advertising operations very much like our own, but there are other countries where advertising expenditures per capita are very low. There you will find that freedom of the press tends to be a fiction. To begin with, radio and television must be supported by the state, and they become the official propaganda organs of the party in power.


"For commercial television
is free-speech television."

Indeed, the last thing that these parties want to see is commercial television. For commercial television is free-speech television.


(Go to page 2 of 4)


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