THE CAMPAIGN ESSAY: ADLAND'S CREDIBILITY GAP
By Chris Ingram, partner in Genesis Investments, campaignlive.co.uk, Friday, 06 June 2003 12:00AM
Advertising agencies are paying for failing to keep up with client companies' professionalism, accountability and results focus. Thinking like chief executives would help, Chris Ingram argues.
I've been away from the advertising and marketing sector for more than a year now and with a lot more time on my hands, it's given me the chance to think, to read and to listen to people - both inside and outside the business.
There is no question that the marketing communications business is suffering from a severe lack of confidence at the moment, none more so than in the advertising and media agencies. But then adland has always been prone to extreme responses. Five years ago, the industry was euphoric - including those who had little to shout about - and now the industry is in despair.
That includes those who have first-rate businesses. Yes, it's bad, but it's not quite that bad.
The fundamental problem, in my view, is that the industry has allowed an increasing gap to open between what is on offer and what the client really needs. Over the past 15 to 20 years, client companies have moved on tremendously in terms of professionalism, accountability and results focus, yet on these dimensions and in spite of all the hype, the bulk of our industry seems to have moved little, if at all.
The immediate casualties of this 80s timewarp are of, course, the massive lay-offs and red ink baths we have seen over the past couple of years.
As the going gets tough, businesses shed where least value is perceived to be added. Over the longer term, however, the even bigger casualty is the opportunity lost to our industry. It is rightly convinced that building strong, sustainable brands is crucially important to the future of almost every client, yet paradoxically most agencies feel increasingly distanced from the top table.
Earlier this year, I attended a Solus Club debate titled: "Agencies don't get it anymore." Clients were queuing up to wittily, but pointedly, kick the agencies. They felt that agencies have been very poor at adapting to clients' changing needs and the pressures that they are now under.
The fact is, the writing has been on the wall for a long time. Perhaps the biggest wake-up call was given in 1997 by Niall FitzGerald, the chief executive of Unilever, one of the top-three spenders globally on advertising and marketing. He said: "As I look at the way the world is going and then I look at the traditional advertising agency, I see an alarming discrepancy between what our brands are going to need and what contemporary agencies are good at."
This received considerable publicity, not least because he was right, but if there was a response from the agencies, it was difficult to see.
However, this is not only an agency failing. Marketing departments are often seen as equally out of touch with their own top management. There has been a hire and fire attitude to senior marketing personnel in client companies for some time now. However, the situation has worsened further and the marketing press now frequently talks about marketing director positions being made redundant and "culling" of marketing departments.
A more subtle, qualitative sign is the attitude of chief executives. Take, for example, the McKinsey presentation at this year's Marketing Society Conference which was largely built around a survey of chief executives and their view of marketing. Those views seemed to be worryingly negative - often they saw marketing as being out of touch with the rest of the company and the realities of doing business in today's harsh climate.
"Marketing has been absolutely brilliant at avoiding all accountability." "People in marketing are all fluffy bunnies," were two damning quotes among many. At the very best, this shows a worrying lack of respect for the marketing function and the people in it and it is affecting marketing personnel at client and agency alike.
The over-riding problem is that for too many, on both sides of the fence, marketing has been regarded as a science or art in its own right, with members of this exclusive club happy to spend their time talking their own language to their own group and giving each other awards. The result is that marketing has allowed itself to be separated from business. Not least, it has not allowed itself to be judged by business criteria.
One way forward for the marketing communications industry has been pointed by the big conglomerates. Surely, an integrated global service is what the market needs? Perhaps. I think the jury is still out. Real integration has proved an elusive beast; certainly a large scale bundling up of services does not necessarily add any value, quite often it delivers the opposite. However, I am not about to engage in more of the currently fashionable conglomerate-bashing. The deeper issue is around how marketers approach their work, not around how the industry is structured, important as it is.
So what is to be done? In my view, it really all boils down to two things: professionalism and trust. There's tremendous potential to be unlocked if our industry, individually and collectively, could stop short-changing itself on those two critical fronts.
Professionalism is another word for quality and commitment. I am convinced that our industry could learn from the top management consultants in this regard. Like them or loathe them, they are way ahead in terms of rigorous, fact-based analysis, focus on chief executive-level concerns and the impact they can deliver on the overall business. Their project and talent management skills and commitment to attracting and developing top talent also leave most marketing comunications organisations standing.
This is not to argue that marketing services companies should turn themselves into management consultancies, far from it. The lifeblood of our industry is innovation, something that the management consultants find very difficult to deliver.
Talking to board-level executives in major companies, many of them are frustrated with both management consultants and marketing agencies. They may increasingly not rate ad agencies, but they don't like the way many management consultants make strategic recommendations, charge a lot of money, but don't take responsibility for delivering the solution.
However, why not learn some of their tricks: rigorous thinking, willingness and ability to focus on the chief executive agenda/real business issues, allied to strong project management? One can't help feeling that if marketers had the intellectual rigour of a top management consultancy, while retaining their innovation skills, there would be no questioning of their role and contribution. Of course there are some outstanding people in our business with these skills but ironically, the industry now has an image problem.
The second issue is one of trust. Our quickness with words and images professionally seems to have made us extraordinarily casual in the way we communicate. We pick up words and use them fluently without even bothering to think what they really mean, and then claim their properties. That's why the industry is often thought of as flip, instant and, yes, plain shallow.
So, for example, people talked about "360-degree communications" when all they were comfortable with was offering a TV solution. People talk about "synergies" with no serious intention of really finding them. Many claim an "integrated" service, including the big groups, where those with the different skills often don't even know each other.
Perhaps the best example of this weakness was the arrival of the phrase "media neutral" a couple of years ago. Suddenly, there were pull-out supplements and even conferences on the subject - and it still continues.
From what I can see, "media neutrality" means recommending the solution that is right for the brand, rather than the medium you might be most comfortable with or what makes the most profit for your agency.
So really, being media neutral is being objective about your choice of media communication vehicle. Can you imagine any of the professions holding conferences on objectivity?
If the industry soils its own language and now doesn't even notice when it's doing it, why should we expect to be credible with clients, particularly at board level? And if you are not credible, you are not trusted. Again, it's no accident that the boards of major companies are now much more comfortable with the language of management consultants rather than that of the marketing communications industry. I find that a sad comment, but I know it to be true.
In summary, without a substantial injection of world-class professionalism, the marketing industry is condemned to be a perpetual second-rate player and never really a master of its own destiny.
Yet, as I stated in the opening, brand- building and marketing issues have never been more important or perceived to be more important. In a world of huge change and complexity, real brands often deliver greater competitive advantage than any shortlived technological benefit. And the ability to communicate at all levels and in all directions is increasingly important.
(These days chief executives who don't grasp that often lose their jobs.)
So, the opportunity is there. There is no need for the industry's gloom and depression. It just needs to take some of its own medicine - it has failed to understand its target audience properly and its changing needs.
But the industry will continue to fail to connect properly with its clients and earn their trust unless it really wants to change and has the steely, long-term determination and focus to do so. Sadly, there is not much sign of that yet.
- Chris Ingram is the former chairman of Tempus which was sold to WPP for £432 million in 2001. He is now a partner in Genesis Investments.
This article was first published on campaignlive.co.uk
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