New Agency/Publisher Model... is another nail in the coffin of "the agency" (Originally published 11 October 2014)

Last week Leo Burnett announced they had formed a partnership with Huffington Post. It was spun as "groundbreaking" because it would offer Leo Burnett to position their brand Special K in new ways that would combine the Special K brand with the HuffPo brand.

Maybe I'm missing something, but this sounds a lot like the partnership that I and a lot of other media people have been doing for at least a couple of decades now.

What is new is that a creative agency is doing it directly. One of the reported benefits of doing this is because it is streamlining the go-to-market process. Mark Renshaw, Chief Innovation Officer of Leo Burnett, said "the partners have already reduced the time it takes to plan and execute a campaign down from eight to four weeks. It’s an 'acceleration thing for both of us.'"

To me this all sounds like acknowledgement that the agency system is broken and breaking down. Reading between the lines this announcement is basically saying "well, going through our media agency takes too long and they really aren't sure what we are doing from a strategic and positioning standpoint anyway, so why not cut out the middleman."

I couldn't agree more. Most media companies have been so concentrated on buying and quantitative measurement that they can't work as proponent of their brands and partners to the creative agencies, so now they are just getting cut out of the process altogether.

If anything this announcement says the agency model of creative-to-media-to-media-outlet is unwieldy, breaking down, and moving toward a smarter, faster, integrated model; one for which not a lot of large agencies be they creative, digital, media or otherwise are ready.

Want to Learn How to Play Shortstop? (originally published 3 October 2014)

Advertising Week 2014 started yesterday and it was opened by Sir Martin Sorrel, fresh off his Cannes keynote, hosting a panel on "Winning: How to Win in Today's Competitive Environment" and I for one had absolutely no interest in going.

Not because I have anything against Mr. Sorrel or Sir Martin as I'm sure he prefers to be called (I certainly would if I had received a Knighthood), but I wasn't interested because I'm really not going to learn anything from Sir Martin.

I don't know Sir Martin, but I have met and worked for a couple of the CEO's of the holding companies, and they know a lot of things. They know a lot of things about finance and banking that I'm never going to comprehend and if I wanted to know about those things they would be on my "to-do" list of calls.

Equally, I would welcome them as headliners at the "How to Finance Large Advertising Holding Companies" conference. (By the way, if that conference could be bottled, Ambien would be given a run for the money).

But if I want to know about winning in advertising I would much rather hear from the winners who do and have done the work to which we all aspire. I would much rather hear keynotes from Dan Wieden and David Kennedy, or Martin Puris and Ralph Ammirati, or Richard Kirshenbaum and Jon Bond or from Bill Koenigsburg and so on than from the leaders of the holding companies.

It's like going to baseball camp and being taught how to play Shortstop by Hank and Hal Steinbrenner. If I'm paying for camp -- a lot of money for camp -- can I please get the Shortstop section taught by Derek Jeter or Cal Ripken?

Yeah, I know the business realities -- inviting a holding company president to speak is basically printing money because then all the agencies in that company are forced to pay for your tickets.

But some of us would really like to pay our hundreds of dollars for our limited-access-tickets for something useful and stop having every major industry event turned into...well a crass marketing opportunity to get me to spend money on something that is almost completely useless.

To me these conferences have turned into icons for everything that is wrong with the industry: Advertising agency people awash in much too expensive food and much too expensive alcohol focused solely on making the most money for the least amount of work; such that nobody seems to be much interested in advertising anymore -- why an does an ad work or not -- how it is done -- what are the pitfalls? How do I do "Just Do It" or come up with "The Ultimate Driving Machine" or start the fastest growing and still independent media agency the business? Well, I don't know -- but what I do know is that you won't hear about that at any industry conference.

We Lost Our Mojo...And the Clients are to Blame (originally published 30 August 2014)

Scene: Opens on two Jewish Women at a table a Lower East Side Diner:

First Woman: The food here is just awful!
Second Woman: And such little portions too!
First Woman: So I will see you again here tomorrow?
Second Woman: Are you crazy? Of course, where else am I going to be?


I was reminded of the old Borscht Belt joke above as I was reading Nancy Hill's, President of the 4A's, Op-Ed Piece in the Wall Street Journal a couple of weeks ago with a counter-point from Bob Liodice from the ANA.

Nancy's original piece set out that agencies can't attract talent anymore because clients have driven fees so low that salaries don't attract talent to the business anymore. She argued that largely this is a result of clients' reducing fees via going through "procurement" to hire agencies largely based on cost and not value.

In a quick riposte Bob Liodice responded that agencies can only blame themselves as agency holding companies have never made more profit and there is disconnect between saying that there is no money when the holding companies are almost literally rolling in cash and are buying agencies at a rate of about one every week.

With due respect (and I do respect Nancy highly) Bob is right. The agencies haven't lost their mojo because clients are paying less; actually if you look at the numbers clients continue to pay more and more for less. I have seen clients paying mulit-millions in fees for their business to be be essentially run by 24 year olds. Nothing against 24 year olds but a few million dollars probably buys more wisdom than they have the experience to deliver.

So where is the money going? Holding companies are getting it -- and they are snubbing the clients' nose in it.

One only need to look as far as the comments from the holding company presidents to make the case.

For instance, in the wake of the Omnicom and Publicis debacle, a debacle that everyone from my toddler son to Stuart Elliot knew was coming ... well, everyone, except for the guys who run Publicis and Omnicom that is...well.. to be fair they probably knew it was insane too, but...I'm sure they figured if they could make more money at everyone else's expense -- who cares. These same guys dismissed their $600 million + failure and the erasing of about 10% of their stockholders equity as nothing more than a small bump in the road toward greater profits.

I don't know about your agency, but at mine, $600 million could buy a lot of talent -- say three quarters of Olgilvy NY and... hmm, perhaps throw in a even Da Vinci and perhaps a John Ford, yeah I know they are both dead but with $600 million you could probably raise them up from the dear departed or at least find their likes in a new generation.

Yes, fellow advertising people, even "clients" read the news too and every time a holding company CEO comes out talking about how 18, 20, 40, 120, 600 million really isn't anything to worry about, and "by the way, I'm asking for an additional $5 million in my base compensation this year on top of the double digits I asked for last year and we are going to keep on buying marketing agencies at the rate of one a week, and, by the way, I can't write a headline or a media plan to save my life" all make the procurement people just sharpen their pencils a little more.

All of that money comes from somewhere and its coming from the people who work day in and out at the agencies. It is only so long that you can pay for increase profits on the backs of 22 year olds who work 18 to 24 hours a day or keep firing anyone who makes above $50K a year.

One of my favorite David Olgilvy's aphorisms is "The consumer isn't a moron, she's your wife". Perhaps the holding company pooh-bahs should take heed that the Clients aren't morons, they are your ticket to your Netjet's membership

So... it is all the agencies fault. Isn't it?

But wait.

Like our Jewish diners in the opening, if you don't like what is being served up, one has to ask "why do you keep coming back to the same places"?

The fact is that the Clients are to blame. Not because of "Procurement", but because they keep coming back to the same places to "eat".

Off the top of my head I can think of six independent agencies (mine included) that would do a better job for less than a quarter of the price of the big agencies. And that is largely because we pay our teams an honest wage for an honest day's work, and "honest" means you work for the client and not sit around figuring out how to buy your next yacht.

But all of us independent agencies are still waiting for the call from big clients or from the pitch consultants or really anyone who can't afford the waste at the big agencies.

So, Clients,... one has to ask "when".

When are going to stop eating at the same diners?