Ad Agencies And Their Holding Companies Fail At Their Own Branding

I read with great dismay and sadness about MDC merging KBS into an unknown (at least in the U.S.) Swedish agency (Forsman & Bodenfors) and obliterating the Kirschenbaum Bond name.  Without getting into the history of Kirschenbaum and its recent problems, all agencies go through up and down cycles, sometimes those phases go on for years.  But that is no reason to destroy the equity which has been built into the agency brand, especially one that is essentially positive.  The evidence is that once that brand name disappears, the new agency rarely fully recovers.  As a result, when it comes to mergers in advertising, one plus one often equals far less than two.

As every good marketer knows, building a brand name takes years, often decades.  Destroying the brand can take only a stroke of a pen. Changing or obliterating names can be confusing and dangerous for the brand.

One of my favorite stories is how Omnicom screwed up both Chiat\Day and TBWA. Omnicom merged TBWA into Chiat in 1995 and ultimately changed the name to TBWA, eliminating the Chiat moniker.  Yet, even today, especially in Los Angeles, Chiat’s headquarters, TBWA is still known as Chiat/Day. (TBWA was a stronger name in Europe and is rightfully called that in those markets). 

Batton, Barton, Durstine & Osborn modernized and became BBD&O and eventually BBDO, which makes total sense. Ditto when Doyle Dane Bernbach was bought by Omnicom, it was changed to DDB/Needham (to accommodate the merger of Needham Harper Steers – but Needham was ultimately dropped); DDB was the stronger brand. Other agency brands are still confused by their own name changes.  JWT is still called Thompson or J. Walter or even J. Walter Thompson; I think I understand why that name was changed, but I could make a good case for having left it alone.  Ogilvy, which started as Ogilvy, Mather and Benson, and subsequently changed to Ogilvy & Mather, became just Ogilvy, but to this day is still often called O&M, even by its own employees (checks still are marked Ogilvy & Mather).  Y&R Just this week became VMLY&R (why not Y&RVML since Y&R is the stronger brand, but even with the name changed it will remain Y&R).  

Changing a name does not change a culture.

When the founding principals of well-known ad agencies retire, merge or die, unless they made strong succession plans, the agencies often diminish or disappear and rarely recover if they are merged.  Saatchi & Saatchi, at least in the U.S., never achieved its potential when Compton was merged with Dancer and their name was changed to Saatchi & Saatchi.  Saatchi was on of  Briton's more creative agencies and the two merged into it were heavily package goods agencies, more known for their ability to create effective strategy; for complicated reasons, Saatchi, at lease here in the U.S., never achieved the creative reputation of its London parent.  The merger never took into account the cultures of the two American agencies and the strength of their client relationships.  In the case of this three way merger, one plus one plus one ended up equaling about one and a half.

IPG merged Bozell and Kenyon & Eckhardt and then the two of them into FCB, which was subsequently merged with Draft.  Now, what remains is a mere shadow of the original agencies.

In a mistaken effort to keep contemporary, merged agencies often drop the names of the founders, which may be unnecessary.  JWT is a perfect example of that.

So much of advertising is driven by creative personalities.  When it comes time to sell or merge the new agency people want their names to dominate, but that often destroys the equity which was achieved by the original agencies.  IPG was smart to leave the Deutsch name alone, even though Donny Deutsch long ago moved on. When IPG merged Lowe into Deutsch, aside from being a cultural disaster, they still kept the Deutsch name dominant. The people who ran Deutsch figured out how to keep their culture, despite often rancorous disagreements with the parent company (and occasionally, Lowe, which subsequently and smartly separated itself).  

Kirschenbaum & Bond now joins a long line of wonderful creative agencies which simply disappeared after being merged and submerged – Ally & Gargano, Scali, McCabe & Sloves, Wells, Rich, Greene, Lintas, Ammirati & Puris are all examples of great brand names which disappeared out of the hubris of holding companies.  

More often than not, putting these agencies together, without any regard to their individual cultures and differences actually ended up killing the brands, costing the holding companies millions of dollars in the long run.

What a waste.

The Diminishing Of The Ad Agency Creative Department

Much has been written about the changes in advertising over the past couple of decades.  Account management is on the wane; planning is no longer dominant.  But little has been written about the diminution of creativity and executions. Once upon a time in American advertising, the creative department reigned supreme. This was true even at agencies that were account or strategic oriented. Even at those agencies, with few exceptions, if there were an argument over execution (not strategy), the creative department would win. Many of my readers would agree that now there is a dearth of exciting, innovative executions, especially on television.  Here is why.

Over the past 30 years a conversion of events has caused the influence of creativity to diminish.

The advent of planning has affected creativity more than the creative departments realize.  Corporate procurement has interfered with implementations, furthering the diminishing of executions.  Weakened account management has effected strategy and given rise to the consultants, who, for the most part, don’t understand advertising or production.  And the holding company emphasis on profits, profits and profits has caused the work to suffer since less time is spent by senior people “tweaking” the work.

While the intent of planning was excellent – originally to be the voice of the consumer and the provider of new insights in order to allow more effective communications – planning has devolved into management of focus groups and supervision of outside research. Many categories and brands have been focus grouped to death.  It is very hard to develop new insights into these.  How many times can an agency develop new insights into detergent or pet foods or computers - categories which have been planned to death over the past quarter of a century.  As a result, my observation is that planning is on the wane at most agencies and, in fact, there is actually less and less classical communications research.  Sadly, neither planning nor research is really being replaced at ad agencies.  In fact, clients have taken over a lot of this role, which is kind of like the inmates running the asylum. 

Much has been written about procurement departments and corporate management demanding that less money be spent on marketing and production.  WPP made an attempt to establish Hogarth as purely a production agency, taking the supervision and execution of all aspects of broadcast and, to some extent, print production away from the creative department which developed the work.  This, was an effort to save clients’ money. Interpublic followed suit. My observation is that these attempts have not achieved their intended goal; rather they have diminished the quality of the message because the very people who created the work are not totally involved with producing it.  The truth is that the vision to execute should remain with the people who created the concept.  One of the complaints by both agencies and clients is that by cutting costs on some production, much has been lost in the translation.

There is no question that more than occasionally, agencies abused the trust clients paid them by overspending on executions, particularly production of television commercials.  I can remember one agency creative director arguing with his client about hiring one of the most expensive star commercial directors at an outrageous rate of $20,000 per day, but with a three day prep minimum and two shoot days; ridiculously, the commercial was merely thirty seconds of a talking head, shot from the waist up.  The total cost for that commercial was to be about $400k.  The account people complained but the creative department insisted.  Eventually, the client rejected the bid and got its own bids for less than a third of that. I am sure, because of the nature of the commercial, it was not much worse than if the star director had done it.

Over time, with incidents like this, clients lost faith in their agencies ability to look out for their best interests.  

Client fees put a damper on big production costs by putting constraints on the amount they would pay for execution and implementation, regardless of the concept or the need for a big production.  As a result, much of the show business has been taken out of advertising.  Today, much of the norm is stock footage and stock music.

This may be good for the corporate bottom line but is not good for the executions or the consumer.  

Finally, the star system is gone. This may be the biggest reason that there has been a diminishing of the creative department. Once upon a time there were creative people whose names everyone in the business knew.  They created award winning work.  Other creative people would, if necessary, take salary cuts to work for them.  These were not only creative directors, but included group heads and others.  Most of the major agencies had one or two (or more) of these well-known people.  Today, there are very few "name" creative people.  The star system has been destroyed by the holding companies, for reasons that make no sense. 

All of these things have contributed to the diminished influence of the creative department. 

Is Sharing Salary Information Fair and Productive? Is It Anyone's Business?

I saw an interesting article online about the pros and cons of sharing salary information.  It generated a lot of thought and is worth a discussion.  Off the bat, I have to say that this post has nothing to do with equal pay or with the New York City law which now prevents asking for salary history. 

One observation I have made while recruiting is that people quite freely share their salary information with their friends and associates.  One result of sharing this information is that by telling your friends, it may actually help prevent salary discrimination.  Two people with the same titles and responsibility as well as the same amount of time in grade, so to speak, should be paid the same.  Right?   Well, on the surface it would seem so.

Many businesses are complicated; seemingly similar clients may actually be quite different from one another.  Advertising is a difficult business.  All jobs are not equal, even if their titles are. Should an account person working on Coca-Cola make the same as an account person on Kellogg’s or IBM if they were all at the same agency?  On the surface the answer would be yes, but one would have to thoroughly understand the dynamics of each business in order to answer the question fairly.

All these accounts are large, fast moving, are heavily advertised and have many executions. This would seem to make them equal.  But wait.  Suppose one account was in production almost every week and the account person has to travel to supervise the production – this may mean five or six workdays a week, most away from home for overnight.  Suppose another one of these accounts were highly planning or research oriented and required the account person to constantly attend focus groups all over the country and have intense knowledge of planning and research.  Perhaps the managers on these accounts have very different personalities, ranging from lovely and easy to difficult and abusive; ditto for the clients.  And perhaps, because of the locations of those clients (and agencies), there is frequent travel to and from the client, often over night or, if on the same day, very long commutes from early in the morning until well after dinner.  And finally, the agency/client culture is such that on one (or all) of these businesses, work requirements are 9AM to 10PM daily on one account, but only 9AM to 6PM on another.  Finally, suppose the clients were quite different and required the people servicing them to have different skills – from education to technical knowledge.  Some clients are abusive, some are easy.

There are so many variations that it would be impossible to pay the people working on these businesses the same.  Several years ago I wrote about how MVBMS (now HAVAS) paid people more to work on MCI than on other accounts.  MCI burned through people because it was so impossibly busy.

It is the responsibility of the company to insure equal pay for equal work.  And much of the work at ad agencies is unequal because of the things I have mentioned.

So, among employees, sharing salary information might be counter-productive and create unfair pressure on the employer. Worse still would be the sharing of bonus information at the end of the year.  All work and all workers are not created equal.  Some workers are superstars and deserve to be paid more.  Some may have it much easier than others and might be paid somewhat less. Bonus money is totally at the discretion of the employer.

This has nothing to do with equal gender pay.

None of this is to say that women should be paid less than men, especially if their jobs are equal.  But that is a different discussion.  Assuming that all aspects of the job are the same, then people should be paid the same.  But that information should not be shared.

Besides, there is one inevitable truth when it comes to salaries.  Most people exaggerate their pay to their friends (and potential employers).  Over the years, I have met candidates who tell me how much less (or more) they are making than their friends at work.  In so many of those cases, I know both people and know what they are telling me is just not so. 

When I was brought up, my parents told me that it was impolite to discuss salary, since it was nobody’s business.

My point of view is that sharing salary could be counter-productive and the expectations it sets up may be unrealistic.

Why You Must Keep Your Résumé Up To Date

Everyone who reads this knows it is true; but few people will heed the advice.  Even people who are happy in their job or have been in it for a long time need to keep their résumés up-to-date.  Many people wrongly consider keeping a fresh CV as either unnecessary or disloyal.  They also believe that they can create a new one from scratch in a very short time, so keeping their résumé up to date is unnecessary and very low on their list o priorities.

Nevertheless, it is smart personal business to keep your résumé up-to-date.  

I have written many times that when someone gets promoted, gets a raise or gets a new experience, like a rotation, their recruiters should be told about it and their résumé should be updated.  That promotion or new capability may qualify and make someone a candidate for a great job that they may have wanted and not have been qualified for prior to the change.  People who can help your career need to know about it.

I cannot tell you how many times  I reconnect with a candidate and I learn about new experiences which they have recently had.  Those skills might have made them right for an assignment I have or recently had (and, had I known, I could have called them).  This is especially true of people who have a wish list.  Over the years I have had many candidates tell me what their ideal job would be, but at the time they told me, they did not have the qualifications.  Automotive, cosmetics, computers and not-for-profit are good examples.  And someone who, for example, wants to work on cars and gets rotated on to automotive after market - tires, for instance -  may suddenly be more qualified to work on a car account.

It takes a while to create a new résumé, but updating an old one is lots easier and faster.  One never knows when an opportunity will be presented which requires an immediate response and you need to be ready for that response.  It is just smart business.  

Many candidates have told me that I should look on LinkedIn to see their background.  In most cases that listing is insufficient and almost never provides the complete information which should be contained on a resume or CV.

LinkedIn is designed to contain only top-line information and rarely has enough detail to make it fully useful to companies or recruiters.  On LinkedIn, most people do not list the details of their current or past employment.  Rather, people put down the companies or categories they have worked on but fail to list the brands they have been exposed to.  It can make a big difference if one is working on Tide or on Pantene or Bounty, so saying P&G or Proctor is not enough.  Many people only list their title online which is no help to recruiters or companies who may be interested in their background.  To this day, an account director at one agency is the same as a management rep or a group head at another agency, but responsibilities, if not listed, can be unclear.  And, of course, there are almost no descriptions of accomplishments.  All of those things belong on a résumé.

In one of my first Ad Age columns, I wrote that a person who reads your résumé wants to know only four things:  Where did you work, how long were you there, what did you work on or do, and whether you got promoted.   Remember, the average person who sees your résumé will only spend six seconds on it.

One never knows when a friend, a recruiter or a person from another company will call you and ask for a résumé, “right away”.  Making them wait may impede the opportunity; it could communicate that you are not that interested.  In addition, we all know that companies are not loyal to their employees, so often, people who have unexpectedly been terminated, have to spend days or even weeks making a new résumé.  If they had an old one updated, it would speed up the process immensely, even while crafting a brand new bio.