Nightly business report

1. Nightly business report

2. the advertising industry has blossomed into a global powerhouse with spending worldwide now exceeding $430 billion a year • Long gone are the days when a single television show and its commercial messages could attract more than 70 percent of the audience, as an episode of "I Love Lucy" once did.

3. The business model has been built around the 30-second TV commercial. • Ten years ago it was 80 percent of our media investment. Today that is less than 50 percent. It is not that television will continue to decrease, but we're starting to use media in different ways:

4. But most agree a successful 21st century marketing strategy requires adding the new media into the mix. • Internet marketing can be complex for all involved, but it can also be very profitable. Just look at the market caps of Google, Youtube and Myspace.

5. Part II • Web advertising jumped 33 percent in the third quarter, hitting a record $4.2 billion. • Eight years after it first went online, Internet search giant Google has a market cap of $130 billion • Banner ads continue to be attractive on content-oriented sites because they can be tailored to the audience and because their effectiveness can be measured, if advertisers take the time to learn the new technologies.

6. Advertisers are also using new technologies to spread the word in ways which are more word-of-mouth than paid advertising. They go online themselves in blogs and discussion groups on popular sites like myspace, the social networking site which was purchased by Newscorp for $580 million. And they plant video of products, movie clips, and TV shows on sites like You Tube, the fast growing video blog site just purchased by Google for more than $1.5 billion.

7. Many cell phones report their location, and these will allow for location-dependent ads to be sent to customers, asking, for example, for information on nearby restaurants, banking machines or gas stations. • Although the new technologies are generating a lot of buzz, they draw only 6 percent of total advertising dollars and traditional media is fighting hard to maintain its market share

8. Part III • ABC-TV puts its prime time network shows on the electronic shelves of Apple's iTunes store. It charges a fee for each download. CBS puts local news from its TV stations on the Yahoo! web site. Yahoo! will sell advertisements and share the revenue. And CNN, after trying a paid subscription-based system for downloading news video, removes the fee but begins each story with a commercial. After first ignoring and then fighting many of the new technologies, the big media companies have now come to accept that consumers want to be in control. The companies are scrambling to find new ways to deliver their messages and to sell a total marketing package involving multiple delivery platforms.

9. Both the media giants and the advertising agencies now realize that consumers don't automatically skip marketing messages; they skip boring ones. • American Express is a case in point. Always a multi-platform marketer, television now demands less than half its ad budget. Much is spent on direct mail and in providing unique services to American Express customers. Where TV is used, the messages are designed to stand out from the clutter with first class production effects and compelling story lines.

10. Some of the oldest forms of advertising have entered the digital age. These outdoor billboards can change their messages quickly and some can respond to requests for information from people on the street using their cell phones. Big media and advertisers are also placing their messages wherever an audience might be found. Sony Music, Nissan, Adidas, Toyota and Starwood Hotels are just some of the companies experimenting by running marketing campaigns in an online game called "Second Life," where players create a virtual world.

11. $70 billion a year is still spent on television advertising and to help cope with video recording devices which let consumers skip commercials, the industry is looking to measure commercial viewership separately from program viewership. • Selling by yelling is over. In this period of time, with the opportunities to see things any time you want, the content just has to be really, really riveting.