Advertising
Age published another pathetic
perspective from anonymous scribe
M.T. Fletcher titled, “3 Ways To Fix The Ad Industry—Before It’s Too Late.”
Unfortunately, the three
solutions are neither original nor viable. So, it’s unlikely anyone in Adland
will view Fletcher as a prophet; but rather, as a megaphone-packing
streetcorner lunatic hollering, “The End Is Near!”
Here’s a quick
dissection of Fletcher’s ravings:
1)
Agencies should get paid for their work, not their hours. Fletcher
appears to have lost touch with the industry, which has evolved to
project-based cage fighting. Clients are paying for products—whether tangible
executions or strategic thinking—which are defined with line-item invoices. And
like it or not, White advertising agencies compete by low-balling estimates to
secure business.
2)
Call bullshit on conflicts and own your IP (Intellectual Property). In this
case, Fletcher appears to have lost touch with reality. The entire field is
rooted in market share and competition. To propose that White advertising
agencies could service competing brands—and be privy to confidential
competitive data—flies in the face of ethics and integrity. Granted, Adland has
never been a bastion of ethics and integrity, but c’mon man.
As
for intellectual property, see item 1 above. That is, clients are paying for
products, and most invoices are essentially contracts stating that the client
owns everything delivered and may do with it as they wish. On the flip side,
name a single White advertising agency that has allowed staffers to own their
intellectual property. (Cue the crickets.) Indeed, former and terminated
employees are even erased from award submissions for work they produced.
3)
Agencies should (re)hire senior talent if they expect to stay relevant. This
is actually a prelude to Fletcher’s next exposition, a gripe on perceived
ageism in Adland. As for the notion that senior talent will keep White
advertising agencies relevant, well, Fletcher’s outdated and irrelevant
viewpoints negate his own argument.
3
Ways To Fix The Ad Industry—Before It’s Too Late
Why
it’s time to rethink billing, IP and talent
By
M.T. Fletcher
The
previous installment of this column was a well-meaning rant against
agencies attempting to sell process instead of ideas, and it seems to have
struck a nerve.
Half
the industry believes that clients want creative solutions to their business
problems, while the other half is trading process for pennies and peanuts.
Because the two sides can’t agree, agencies are having an identity crisis,
clients are losing faith and rolling layoffs are now a seasonal occurrence.
So
if we’ve diagnosed the problem correctly, what can we do to turn things around?
When an election year rolls around, people naturally complain
about our comically corrupt and institutionally inept representatives, at which
point suggestions are made by family and friends on how to save our democracy.
Here’s
my favorite: Hang all the
lobbyists, drown all the lawyers, poison all the politicians and then start
over.
Perhaps
a bit draconian, but it cuts to the quick of the problem, because those
suggestions boil down to money, process and people. Those are the same three
elements we can leverage to save the marketing industry from its current
downward spiral.
So
with apologies to anyone offended along the way, here are three suggestions for
digging ourselves out of this mess:
Agencies
should get paid for their work, not their hours
Everyone
knows that agencies were once paid by media commission back in the days when
creative and media sat under one roof. Recurring fees were high enough for
agencies to hire truly top talent—iconoclastic thinkers who redefined entire
categories with platforms built on big ideas that set a brand up for decades of
growth. Don’t take my word for it, study the advertising archives and you’ll
see a level of storytelling and craft rarely visible today.
This
led to relationships that lasted because nobody felt exploited, so agencies
weren’t distracted by constant pitching or paranoid about pressure from
procurement. The advent of the holding company changed all that, not only for
agency networks but independents, too, because the barons behind the holding
companies tricked clients into believing media was a bulk-buying business and
the creative side was all about client service.
Clients
aren’t buying client service, they are shopping for ideas.
Clients
should expect outstanding service just like you expect the guy at the Lexus
dealer to answer the phone, but you’re not visiting the showroom to find a golf
buddy or a lunch date.
Remember,
the holding company model was designed by small men with big checkbooks who
knew next to nothing about marketing beyond what it cost. Trained in finance,
not the messy business of creativity, they lacked the instincts to charge top
dollar for intellectual property.
Charging
clients for hours is akin to a wireless company charging for minutes. Pretty
soon a competitor announces the first month is free, then a rival who’s
bleeding customers says, hey, now it’s unlimited, and before you know it, an
entire industry is on its knees cutting costs and racing to the bottom like a
sumo wrestler on a bobsled.
Billing
by hours is a disincentive for agencies to solve a problem quickly or ideate
beyond the brief. It corrupts partnerships once based on shared goals and turns
them into transactional relationships. Mischief has said they don’t do
timesheets, and Anomaly once made a similar claim, but our industry urgently
needs solidarity on this issue. If management consultants can align on the
price for adding value, why can’t we?
Clients
should pay for the incremental value of a breakthrough idea—which is
measurable—and not the time it takes to produce a set of deliverables.
Call
bullshit on conflicts and own your IP
Ogilvy
recently did work for both Unilever and L’Oreal, and a while back Wieden worked with KFC and McDonald’s
simultaneously. Clients gladly pay management consultants for “category
expertise” and accept the fact that Deloitte, McKinsey and Bain sleep with
everyone, yet advertising agencies are forbidden from philandering.
Given
that consultants handle more proprietary data than agencies, this never made
sense. Great campaigns come from the DNA of a brand, so a decent agency would
never create the same campaign for Coke as for Pepsi. As retainers turn into
project fees and clients become more promiscuous, it’s only fair agencies
leverage their category knowledge to work across competitive brands. All boats rise.
Agencies
should also own and license their ideas, not sell them outright. If a fickle
client flees, the agency should earn royalties on that campaign, and by the
way, so should the individuals who developed it. (Take a look at the film
production company Artists Equity launched by Ben Affleck
and Matt Damon. It offers clues on ways to be more inclusive in compensating
the talent that makes the magic happen.)
Agencies
should (re)hire senior talent if they expect to stay relevant
As this publication pointed out recently, agencies are making
their quarterly numbers by shedding more senior talent—a very dangerous game.
Statistically, our industry is the most ageist in the world, with less than 5%
of the workforce over 50, which is ironic considering agencies are begging clients
to trust them with the future of their business.
Clients
want an expert who has seen a problem before and knows how to solve it,
confidently and quickly. Independent agencies and brand consultancies are
increasingly attractive because the agency principals are involved, but the
real point isn’t about ownership, it’s having the work guided by grownups who
know the difference between disposable advertising and a long-term idea that
drives business through the power of creativity. There is no such thing as a small
client.
Most
seasoned talent is now freelance after getting cut from their agencies by the
threshing machine of finance. As a result, agency-client relationships are
downstream and unstable because they are being managed by junior talent working
for time cops.
Try
bringing some ballers back from the land of misfit toys, go full New York
Yankees on the salary cap and see what happens. Your clients might reward you
with incremental work, your ideas will get measurably bigger overnight and
younger talent might get mentored for a change.
None
of these suggestions require poison or starting over from scratch. What clients
and agencies need is a renewed commitment to common goals, shared faith in the
business benefits of creative thinking and an agreement to make things fair and
fun for all parties concerned.
If
we can pull that off, maybe we can stop selling process and get back to selling
what clients are really shopping for—an idea that can change their world.