What can advertising do to come out of the vicious cycle?

It's often the lament that the ad agencies are losing value. Your comments?

 

There’s an oft repeated hue and cry that our industry does not get the value it deserves. We are not treated as partners, there is no money in the industry and hence there aren’t enough investments. 

 

Let's start at the beginning on what can we do to get the value back. We are supposed to offer ‘advice’ to our clients. But what are we actually offering? Is it an advice or a piece of poster? 

 

There is different value in an advice which might eventually lead to a poster versus a piece of poster. If we are not offering any solution that has got (creative or strategic) thinking at the centre of it, then the value goes down.

 

Very few agencies have the integrity to claim that what they offer to clients is a well-thought through solution and not the next shiny object.

 

The attitude is that, 'I make good films or print ads hence I will give a good print ad or I will tell a joke through a TVC'. Alternatively, the latest agenda is to offer the next shiny object. Throwing in some AI or IoT into the mix is not a solution for the client. They will not see value in it.

 

The only way to showcase value is to make sure that there is problem solving at the centre of the idea. 

 

But how do you do it?

 

Unfortunately, many times thinking is relegated to planners or to a few creative people. Thinking is everybody's job. The cliche is - strategy is too important to be left to only the strategists. On a serious note, the point is if you are not building that culture where every employee is thinking strategically, then one can never build an offering the client will value. If there is no fundamental strategy at the core of what you are offering, if everything is reactive (only when there is a problem in the marketplace of the client does the agency think of the problem) then your offering will never be seen as valuable. If you are seen as a vendor of creative, then you will be treated as a vendor of creative or a vendor of the new shiny thing. Nowadays, people are even bad with that fundamental creative product. They think that if they bring on the new shiny thing to the table and use some oft repeated jargons then they will be seen as new age.

 

You are seen as cutting edge only when your thinking is fundamentally greared to solve issues or grab opportunities. If you can't do that, forget cutting edge you do not have any edge.

 

Thinking has to be at the centre of your offering. Around that you build some executional layer, technology layer and so on. Another industry that's doing interesting things is consulting. But they have not changed their basic nature. They still have a solid problem solving approach at the heart of their offering. 

 

Are consulting companies a threat?

 

Do I see the consulting companies as a threat going forward? I do. In the immediate future, they are not going to take market share away from us in the seven second videos that we do or the rich media banners that we make, but we shall start to see a value share erosion.    

 

That's because they will offer clients a well thought through idea which is a part of their DNA. This was also a part of the DNA for agencies. But barring a few agencies everybody else is paying lip service to it.

 

How did agencies lose the plot?

 

There are two sets of people who have a 50-50 responsibility for this situation. One set is the agency's own people. The other set is clients. There was a time when clients started getting very close to the creative product and started short-circuiting the entire thinking process.

 

What happened there was that the difference between a marketing solution and a communication solution got confused.

 

Our job is to not give a marketing solution to a marketing problem, but a human solution to a marketing problem. That process cannot be short circuited. At times, a marketing solution may look very seductive. You may do some creative product on that. But it's never a long term solution.

 

As an agency, if you think that your job is to give a quick fix solution to a problem that has been articulated by taking the problem at its face value, then you give a very facile solution. It's lazy because you don't have to do the hard work then. 

 

On the contrary, if you take the problem, analyse it and arrive at the conclusion then the solution offered is not facile but fundamental and it will take some hard work.

 

This has become a vicious cycle. As agencies were taking the short cut, they got less value. As they got less vale, they had lesser senior and good people. Because of a small talent pool, they did not have the capability to devote enough time to campaigns. Thus it became a vicious cycle.

 

Now let's address it the other way. Is it the end of the road?

 

Not at all.

 

De Bono said that the last vestige of competitive advantage is original thinking. Lateral thinking, original thinking or creative thinking is a part of the DNA of agencies. Even consulting companies are not as good at that. If we can just focus back and repackage that offering, if we provide a creative, lateral solution rooted in life, culture and society, then we are back in the game.

 

What the client is paying for is a solution. The idea has to be a fallout of a robust solution. I know of people who took an idea to a client and when it did not work they passed it off to another client from a different category. 

 

The truth is if you are not going back to the drawing board, everytime a problem hits you, you are shortchanging clients. Then the value will be less. Compensation will always be based on the value that agencies are bringing to the table. As long as we are doing it, clients compensate us quite fairly. The larger issue in the industry laments about is that the compensation is not good enough. To me, that's the case because we are selling the wrong merchandise.

 

We cannot be selling Wasabi nuts and expect to be paid the price of the drinks. If you need the price of the booze, then sell the booze and the wasabi. If your suggestion does not have value you will not get paid.

 

When you start compromising at some point of time, it will take you a lot of time to come out of that rut. The whole agency business will get slightly bifurcated into a set of agencies that give value based advice and there could be others who are seen as sellers of the next new thing. You can see that the business is getting there but it's an unfortunate situation. There was a time when every single agency gave phenomenal advice to their clients.  Even if you take all the small agencies, the start-ups of those era, they offered great solutions and people started paying them. Is there a tendency to shortchange the process today? Yes. 

 

The unfortunate part is that there is some amount of laziness even on the agency side. There is nothing called a genius. A genius is a person who has more hours of practice. There are enough competent people in our industry. Some get results and others don't depending on the effort that they are putting in. If you are putting in enough effort, it shows. 

 

Do we need to have a different organisation structure for that?

 

Reorient first and then reorganise. It's a very simple thing. People will pay for value. We should reorient in such a manner that puts emphasis on the difficult questions one is willing to ask in the process of developing work. Is this the right solution that's tailor-made for this situation or will it work across? Is it a solution that can cut through the priority list and reach that audience? These are some of the difficult questions to ask. Unless you are asking these questions at the stage of developing work, then your chances of arriving at a solution which is of value are very slim. A significant part of it is honesty. Lot of people used to talk about selling techniques. Many times I have seen that if your work is well thought through, you don't need to do too much of selling.