People are coming out of the closet admitting all of that dot-com advertising makes no sense. There is a lot of skepticism about the $15 million ad budgets that are launching pads for bad IPOs, a lot of thinking that the venture capitalists are just subsidizing the TV budgets of America, and that the ad firms are unwilling to speak up and tell the truth: The money is being poorly and recklessly spent.
My favorite was this one, from
, who owns his own ad agency in San Francisco. Gary has some decent credentials for spotting fads: He created the Pet Rock! Here is his unadulterated take:
"I own an advertising agency and can completely agree with you regarding the pathetic array of dot-com ads on the
. The only ad that stood out -- and this will give you an insight into my personal sense of humor -- was the operating room patient who 'had money coming out of his wazoo!' It had me laughing so hard that I completely missed the sponsor's name or what product they were selling.
"Ergo, it was a total failure. At $2.2 million a pop those were very expensive lessons in what
to do with advertising budgets. The dot-coms were, last year, buying up all the available radio time in the Bay area (at ridiculously inflated prices), making it sometimes difficult for agencies who support the market throughout the year to find available times on which to place our clients' ads.
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"But toward the end of the year, when the dot-coms began to realize that they weren't making any impression at all -- not to mention when they learned that they were paying four and five times more per commercial than I was -- they began a mass cancellation and, lo and behold, we could buy as much time as we wanted. I'm amazed that so many dot-coms continue to proliferate and find venture capital money, which they then throw away on advertising that doesn't have a prayer."
Couldn't have said it better myself.
diehards telling me that the 150 people laid off were "sacrificed" in the name of "profitability." Love it!
, in its prime, had nothing on these guys.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at