By DOMINIC MILLS, campaignlive.co.uk, Friday, 31 July 1998 12:00AM
As Gordon Brown would no doubt put it, the economy has reached a
turning point. I’m sure he is right - it’s just that it is now turning
down and a recession seems imminent.
The question is: what should agencies do to prepare? I’ve been in this
job long enough to remember the last time round, when the industry was
woefully underprepared for the pain it would feel (and it was pretty
grim on Campaign, too).
One of the problems then was that most senior executives had only known
the go-go years of the 80s, and therefore had no experience of managing
through recession. That should be less of a problem this time around,
but one should never underestimate adland’s inability to learn the
lessons of history.
Naturally, advertising being a people business, the first thing agencies
did in 1991 was to take an axe to the headcount. So, out went the most
expensive people (ie, those with the most experience) and those with the
least experience (ie, the trainees and juniors). This was a classic
double error, since it left agencies in the hands of a group who were
neither particularly cheap nor particularly experienced - at a time when
clients needed more hand-holding than before. No wonder so many accounts
Out too went all the people who glued agencies together - those who
provide them with the vital physical, intellectual and cultural
infrastructure that makes each unique. Big mistake. These are the kind
of people whose contribution becomes really apparent only when they’re
gone - and you can bet that the clients noticed.
Finally, and this was perhaps the biggest mistake, agencies cut back on
the ’frippery’ that was training. Since they’d fired all the juniors and
weren’t taking any on, what was the point? Maybe so, but as more than
one agency chairman has admitted since, this was an error for which some
agencies paid a long and high price. If there’s a model, it’s Abbott
Mead Vickers BBDO, which hung on to its people and its clients during
the black years and has reaped the rewards ever since.
The language of business executives rarely fails to amuse me - all the
more so when it comes from those companies whose success is predicated
on a close understanding of the consumer. Sometimes this language is
just plain clumsy, sometimes it suggests they are living in a world
parallel to that of their customers.
There were three priceless examples last week. One of them came from a
Nestle executive, who said that of its two food brands, Findus and
Crosse & Blackwell, only the latter had the ’potential to stretch beyond
In a similar vein, Pepsi’s chairman Roger Enrico described his purchase
of Tropicana as a ’dramatic expansion into the morning daypart’.
Meanwhile, one of Tropicana’s competitors told analysts he wanted to
’own the breakfast occasion’.
What worries me is that this habit might catch on. Would a life
assurance company say it wanted to own the ’bereavement occasion’ or a
sanpro manufacturer the ’menstruation occasion’? Don’t laugh. They just
This article was first published on campaignlive.co.uk