Advertising Agencies 2028--Part II

This post is Part II in the MR series on the future of Advertising Agencies. It covers interviews with marketers of all sizes from Fortune 500 marketing directors, to franchisees of major chains, to small to mid-sized retailers.  I hesitate to post this entry as I love ad agencies but none of my sources wanted me to pull THEIR punches.

Here goes:

Fortune 500 Marketing Director—“As you know, I am getting old and have a lot behind me. I remember vividly how, when our agency visited us for a major presentation, it was a big deal. We leaned on them for thinking not just with creative and media execution but also for packaging, new product development and even site location. The agencies that I have dealt with over the last decade have not kept pace with changes. We turned over a lot of our needs directly to Alphabet (Google). Their reps are on top of everything and their analytics are top drawer and keep getting better. The agency that we still have talks of “breakthrough creative ideas” as if it were the 1980’s. We do less and less with them every year. Past agencies did wonderful white papers on the future and had an attack plan for us. These guys are 100% reactive but have zero seminal thinking. It is a shame. In their defense, they can no longer afford the all-stars but they simply do not dig in and learn our business or study the changing environment closely enough. We give them less each year and will likely shift to a boutique or two  and perhaps keep the media buying service which they recommended to us.”

Mid-sized company marketing chief (privately held)—“The agency does not take our threats seriously and their younger staffers are rude. Here is a great story: The grandson of our founder, who leaves us alone but still owns 15% of the company heard that we had a new agency and wanted to meet the team. He fashions himself a private investor and dabbles in deals and is a fair sized player in local philanthropy. He is a true gentleman and sometimes we bring him in for special sessions or dinners with new accounts. He showed up for the meeting with the new shop and said he had a brief history of the company to share with us and the new ad guys. It was wonderful and charming. Perhaps 12 power-point slides plus one 30 second commercial. He showed old print ads, the theme line we used for decades and we, at the company, were enthralled. After about 10 minutes a sniveling little pissant from the agency said, “We are pressed for time. Could you just give us the headlines?” I was never so angry. My CEO slammed me back in my chair and told our large shareholder and friend to continue, please. The younger members of the agency team shifted uncomfortably and within two minutes were texting. Something is wrong, really wrong. These kids have no manners and no desire to learn who we are or where we came from. Our largest shareholder was hurt and it was needless. We hung on to the new shop for a few months and then fired them. Now we use free lancers for creative and lean on the big players for digital work.”

Big Franchisee of major player--“We analyze our sales data very carefully. Our agency keeps asking to take over our sales data. We said no. Finally, their young account supervisor (after two double scotches) told us they needed our proprietary data so they could build their own model to use for other clients and new business. We hired a couple of quantitative nerds who are just what we need. I was appalled at what the agency was up to. Our targeted promotions get better and better results and we do not use conventional media much anymore.”

Small Retailer (under 10 stores)—“My son forced me to hire some young men and women to monitor our on line work. What a great investment! We are not slaves to the Pareto principle (80-20 rule) any more. Our whiz kids have found niche markets for us. There are 3% of our clients who are about 12% of our sales. Amazing. We buy specific sites programmatically and our profits keep inching up. Our agency could never do this for us. I mentioned this to the agency CEO and he said I was missing the boat. I smiled. Actually, the train has left the station and this well-intentioned man does not realize that the business has passed him by.”

Mid-Cap Company (Publicly Traded)—“Agencies do not realize that we need them for very little these days. They say that they have a fierce on line team but we go direct now and save big and get better and infinitely faster results.”

Mid Sized Company Marketer—“I am a bit like you, Don. I try to read everything. My account team never reads the articles that I send to them. I found a great article in WIRED and sent it to the team. At the next session, I asked them for their opinion. The room got quiet. The young lady who is the account supervisor said, “ I am verbal person. Could you tell me about it? I said no. I left copies for everyone and came back a half hour later. Okay, I said. Let’s discuss this. Two said they had been on the phone with other clients and one said she was on line reading what the Kardashians were doing. One person had read it and made notes and we went back and forth a while. Two starting texting after a moment or two. When I called their boss he basically said they were the best he could find. Well, I am determined to find better. The lack of manners and lack of professionalism is astounding.”

Fortune 500 COO—“You know that I worked at two agencies for more than a decade. These guys keep telling me their team is the best. The best at what? I see very little that impresses me. To me and my senior team, the communications world is moving toward mobile. How do you communicate in such an environment? How do you bring out a new product? Can an upstart break through with little money? Agencies could provide some answers or at least strong opinions. We are hiring internally and getting real pros”.

40 year marketer, brash, real character—“Don, what cliche do you want me to trot out? Put a fork in agencies, they are done. Watch as they rearrange the deck chairs on the Titanic. Gone! Kaput! Seriously, it is hard to deal with the rapid changes but few have done a good job of it. I love advertising but these guys have dropped the ball in the end-zone (whoops! Another cliche!)”

More to come in a few days.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com