Close-Up: Live issue - Have ad agencies lost the art of persuasion?

Unless the industry learns to stand up for what it knows is right, its fears about the future will be realised, Massimo Costa says.

This is a backbone.

"You can't run an advertising agency without one.

"Often it leads you to give an honest 'no' to a client instead of an easy 'yes'.

"It means providing a service to a client, not servility.

"Frequently, it results in excellent advertising."

Raymond Rubicam wrote those words, for a Young & Rubicam house ad, 50 years ago. They are more relevant today even than they were then. It's my view that a lack of courage is one of the roots of the self-destructive process that is currently threatening the advertising industry.

I am Italian, and it intrigues me to read a respected UK commentator suggesting that "the London ad community increasingly feels like the last days of Rome". Ultimately, the Roman civilisation failed because it was corrupt. That is not the case with advertising. The business is in peril because it refuses to stand up for its beliefs.

With - of course - honourable exceptions, advertising agencies as a breed seem unable to make the case for advertising. Considering the array of positive statistics they could call upon, and the fact that articulacy is their stock in trade, this is astonishing. Maybe ad agencies, in their anxiety to avoid what clients might perceive as a false step, have lost the art of persuasion.

Conventional wisdom has it that advertising agencies are arrogant, out of touch, pay lip-service to new ways of reaching consumers and are only interested in promoting 30-second TV commercials.

Yet, from what I see from the inside of our industry, perception - as ever - is lagging behind reality. Agencies are falling over themselves to tick all the boxes of digital, direct and interactive marketing, PR and so on. Some of them may not be very good at it yet, but they are undoubtedly trying. Their advertising ideas are proffered almost apologetically. The siege mentality that afflicts them has removed most of their arrogance (though I prefer to call it pride). Agencies are running scared, and fear is death to self-esteem.

It's true that the agency business has always been prey to insecurity. It can hardly be otherwise when the loss of an account can jeopardise the viability of your company. What is different this time is the scale: agencies are afraid that this really could be the end for advertising as a standalone activity.

Many people will argue that this would be no bad thing. The age of the one-discipline agency should be over. The blinkered view from the advertising silo is no longer acceptable when there is a multiplicity of more efficient, and perhaps more cost-effective, consumer touchpoints. Moreover, great creative ideas are no longer the exclusive preserve of the advertising agency.

The problem is that our industry is lurching from one extreme to the other. From being the acknowledged pinnacle of brand communications, it is now fashionable to castigate advertising as expensive, wasteful and self-indulgent. Its proven strengths in brand-building are being ignored.

So what can the agencies do about it?

First, they should concentrate on doing what they are in business to do: producing great advertising. Lack of focus is the other root cause of agency decline. Clients are looking for great advertising ideas as the core of their branding.

Much of my time is spent meeting clients, current and prospective. Many of them tell me that what they are principally looking for from their advertising agencies is a great advertising idea, as the core of their branding, one that is capable of being extended to other media and other communications disciplines. Ideas that are suitable only for ads will be given short shrift, and it is in any case questionable whether such work could possibly be effective.

The second thing that agencies need to do, in Rubicam's words, is grow a backbone. Our industry is full of agencies that are prepared to give clients what they want, rather than what they actually need. It's not a recipe for success or even survival. It's also cynical and in no way qualifies as client service.

I am aware that saying the occasional "no", as Rubicam advises, is the most difficult challenge any agency can undertake. That said, however, I don't believe that Rubicam meant a straight "no". There are many ways of saying it without getting into a confrontation. The best is to develop a relationship of mutual trust where each of you respects the other's judgment. With trust, "no" becomes "would it be better this way?"

There is another kind of courage that agencies should also cultivate, the courage to embrace change: we should all bring our knowledge, experience and expertise with brands to bear on the opportunities that are offered by new technology and new media and make them relevant - truly integrate them - to everything we do in the interests of our clients. If our ambition is for true partnership and intimacy with clients, that's the only way to achieve it - and deserve it.

- Massimo Costa is the chairman of Young & Rubicam and Wunderman Europe, the Middle East and Africa.

THE RESPONSES

- Stephen Whyte, Chief executive, McCann Erickson London

The role of agencies and the nature of client-agency relationships are constantly evolving. Twenty years ago, marketing departments were small, pre-testing unheard of and three-year plans the norm. Clients relied on the opinions and subjective judgment of their agencies far more and were more prepared to take short-term risks in the pursuit of long-term gains.

Today's world is a little more complex. Agencies must operate as part of an expert, diverse and flexible team. Their unique skills are still highly valued by clients, but marketing directors now need hard evidence of short-term return on investment as well as their agency's opinions.

They need clever ideas that create demand. Not subjectivity and pride.

- Robert Senior, Managing partner, Fallon London

The hunt for an agency backbone rather presupposes that only agencies would benefit from a strong ad industry. When perusing the current creative output on our computer screens, high streets and, dare I say it, TV screens, the keen eye will spot more friendly compliance than good counsel.

Who's at fault and who really loses out? With creativity firmly on the balance sheet, is it not the client community that should be lobbying hardest on our behalf?

It is often said that clients get the work they deserve. It's true. And the good clients who value an agency's ability to attract and nurture talent, and reward it accordingly, deserve the good work and results they get in return. That's a backbone worth hunting.

- William Eccleshare, European chairman, BBDO

Our industry is currently polarising between those who embrace the world as it is and those who pine for a past which probably never existed.

The reality is that the confident agencies have consistently understood that our business has never been about single-channel communication, have always stood by their core beliefs and have long been committed to demonstrating their worth. A quarter century of IPA Effectiveness Awards and their equivalents throughout the world has given us all ample evidence that, at our best, we deliver real commercial value.

The great agencies have always known that it' s all about the quality of creative ideas, rather than the media through which they are communicated. Plus aa change ...

- Peter Scott, Chief executive, Engine Group

I returned to our industry a couple of years ago after a decade or more. Much had changed, but not for the better.

While acknowledging the cry for backbones of steel, we need to recognise two fundamental shifts. First, our clients are under intense short-term pressures to deliver. Second, our little industry has over-fragmented and fallen a long way down the food chain.

We must fight our way back up. We need to reinvest to make our businesses relevant again. We need to reposition ourselves as trusted advisers. For me, this means media and communications planning need to be integrated with the creative process.

And remember, no-one ever asked a brain surgeon for his hourly rates. And that when you pay for the best, you tend to listen to the advice that's being given.

- David Bain, Planning partner, Beattie McGuinness Bungay

Ours is currently an industry of sulking teenagers. "Advertising is utterly rubbish," we mumble. "We're doomed," we mutter. "Not that anybody cares, you're all on metube having fun without me." With our endless whining and our directional haircuts, these are not the last days of Rome but the last hours of the school disco.

From my portly post-pubescence, I see an industry being set free from the tyranny of a broken distribution system. And, as the people who make content for brands, we are being presented with opportunities Big Ray Rubicam couldn't have imagined. So it's not about us saying "no" to our clients, it's about offering them something new and startling for them to say "yes" to. And for that we will need more grey matter, not more backbone.

- Bruce Haines, Chief executive, Leo Burnett London

I've never met a client who didn't fully understand that advertising is a very good thing indeed. I'm less sure that many of them appreciate the manner of its generation or that we in the industry have done a great job of explaining it to them. Great clients demand and get the contribution of great agencies and sustain it through long-term relationships built on mutual respect, trust and fair payment. Less great clients exploit the over-supplied nature of our industry, order our product by the yard but pay by the inch. And here's where backbone is missing. Once agencies win the business, most are likely to fight for ideas. But to win the account in the first place, many won't have the bottle to seek fair remuneration and, in doing so, devalue their product.

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