Close-Up: Are ad chiefs too old to grasp digital?
By Pippa Considine, campaignlive.co.uk, Friday, 13 November 2009 12:00AM
Sir Martin Sorrell says agency heads tend to be resistant to change. Is he right?
Last week, the WPP chief executive, Sir Martin Sorrell, claimed that brands are not spending enough online because the people who run their agencies are too old and resistant to change.
Speaking at ad:tech New York, Sorrell came down on brands for investing an average of 13 per cent of their marketing budget online, rather than a more logical 20 per cent. "The people who run agencies tend to be of an older vintage - to put it politely," Sorrell said. "They tend to be resistant to change and want to spend the last three to four years of their careers travelling around the world rather than dealing with fundamental strategic issues on a daily basis."
Getting the obvious out of the way first, Sorrell himself is just three months away from officially being a UK pensioner. Of course, there's not much question about his own adaptability and readiness to change. So it must be all the others.
Well, if we're looking in the UK, there aren't many others. With an industry featuring a famously young workforce, there are only 5 per cent of all the industry's employees that are over 50, according to the latest IPA census.
James Murphy, 41, a founding partner of Adam & Eve, sums up the thinking of many chief executives: "Most are not that old compared to leaders in other industries and if they didn't understand or exploit the possibilities of building brands with digital, they'd be enormously out of touch and wouldn't be in that job to start with."
Murphy also suggests it might be more of an issue in the US, where more agency bosses are investor-friendly figureheads, with experience and age holding a premium - one reason why brands in the US more readily split business between traditional and digital agencies.
Will Collin, a founding partner of Naked, believes there is something in Sorrell's thinking and that older chief executives who are not instinctively at home with digital may be holding the industry back. He calculates that anyone at college in the day of the home computer counts as a digital native, which includes those in their mid-forties. If you're talking digital internet rather than computers, the age reduces to a more junior thirtysomething.
Mark Collier, 49, a founding partner at Dare, while believing that you are never too old to understand digital, has sympathy with Collin's view: "A generational shift is gradually taking place and we are seeing the emergence of a new breed of marketers who not only understand the new marketing agenda, they are diverting an increasing proportion of their budget towards implementing it in practice."
Arguably, it may be just as much about the structure of agencies as the men and women at the top. "Agencies are structured with a lot of inbuilt inertia," Collin says. "As an agency manager, you don't want to create enormous change, so the tendency is to change things by increment rather than rip it all up."
If there is a slowing in the growth of digital agency business, then there's also optimism about the future. The DDB London chief executive, Stephen Woodford, believes that any maturing in the market will soon make way for another wave of growth, partly due to the development of digital and internet TV.
Then there's always the possibility that some clients might be better sticking with a more traditional strategy. "If you're a large traditional agency with a lot of FMCG accounts, they are less obvious users of digital and there's an argument to say that they shouldn't," Murphy says. "The web is littered with failed FMCG campaigns."
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MEDIA AGENCY HEAD - Marc Mendoza, 49, chief executive, MPG
"I don't agree with Sorrell. I'm 49 years old and I don't understand the intimate mechanics of digital technology, but you don't need to understand the details of how the engine works to drive the car.
"The margins are still higher on digital than other media, and about 26 per cent of our billings last year in the UK were digital - it's massively important to us.
"So why would anyone of any age not encourage their company to embrace digital, regardless of whether they come to work needing a Stannah stairlift or with a skateboard under their arm?
"The people in charge tend to be businessmen and if they see a part of the business become more valuable, they will promote it."
DIGITAL AGENCY HEAD - Mark Cridge, 36, chief executive, glue London
"You don't have to be young to understand digital. People growing up with it will be more proficient, but the digital transformation has only just started.
"Agency leaders need a broader range of skills - experience and maturity as well as a grasp of digital. Good chief execs are going to be able to deliver both and they are few and far between - there's a talent shortage and not just in digital.
"I don't think it's an age issue, it's about legacy. You have to invest in your career and if you've developed certain capabilities to deliver a certain kind of marketing, it's difficult to let go. Either you come to terms and adapt, or you are swept over the edge."
MEDIA PLANNER - Will Collin, 42, founding partner, Naked Communications
"Sorrell's making a valid point. Changes within any discipline tend to occur in a generation rather than more quickly. You're witnessing a paradigm shift in the true sense of the phrase - in the same way that people took time to accept that the planets orbited the sun, rather than the world being at the centre of the universe.
"There are traditionalists and prophets and people sitting on the fence, but it takes a generation for a new world view to become accepted mainstream opinion.
"Whether agency bosses are digital immigrants rather than digital natives is the difference between being instinctive and actually trying to adapt, where you go against your learned principles."
AGENCY HEAD - Stephen Woodford, 50, chief executive, DDB London
"I'm not sure that Sir Martin has got this right. First, age is no barrier to understanding new technology. Look at leaders of hugely successful technology companies, such as Steve Jobs. No chief executive, whatever age, can afford to be a digital Luddite, such is the scale of change taking place.
"Second, digital is now such a big part of our lives. I hired my first digital person about 12 years ago and DDB has had digital skills since the mid-90s; it now comprises about 30 per cent of our business.
"Finally, a key part of the chief executive role is good stewardship, thinking about the future needs of your clients and your business. I'd argue that the older you get, the better you plan for the future."
This article was first published on campaignlive.co.uk
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