A recent article in TIME Magazine shows the national marriage rate in America has hit an all-time low. The percentage of married young adults (25-34) has dropped from 80% in the mid-60s to less than 45% in 2009. For the first time in our history as a country, we now have more single adult women (18+) than married.
I think this trend carries over into business, too. Companies seem less willing these days to contractually commit to suppliers, choosing instead to operate on a project-basis, rotating business among several anxious bidders.
Is this really wise? Is “keeping your options open” the best way to get maximum value for your money?
Well, maybe in the world of off-the-shelf products produced to generally established specifications, but I assure you it doesn’t work for professional services like advertising. Here are five reasons why.
1. Advertising is a collaborative, team-oriented business
The best work comes when client and agency work together as one. There should be no secrets. Both parties should know the good, bad and ugly. They should know the strengths and weaknesses. They should know the competition. They should know the short-term and long-term issues. And they should know the important messages from the not-so-important ones.
The more we know, the more creative we can be. In my experience, real creativity comes from a deep, fundamental understanding of the subject matter, not some sudden, magical moment of inspiration.
2. Value should be measured in results generated
Most veteran ad people know you can’t produce great advertising for clients that won’t let you. And while it sounds crazy that clients would limit the impact of advertising programs they commission, it happens every day. Turnaround time is inadequate. Budgets are artificially low. Project direction is superficial or off-target. Those three things (time, money and direction) largely determine the results of any communications effort. Even the most talented agency practitioners can tell you about efforts that fell short for one or all of those reasons.
It costs the same to run a really lame ad as it does a great one. The difference is in what happens after the ad runs. Were people motivated to ask for information? Did they take some action to identify themselves to you? And importantly, in the world of branding, did the prospective buyer’s expectation of your company’s products and services change?
The more agency and client work together closely and continuously, the more unlikely it will be that results are sacrificed by limitations in time, money or direction. (It’s like a husband trying to put one over on his wife – if it’s important, she will call him on it every time.)
3. Accountability is impossible when efforts are divided
When one supplier handles the media advertising, another produces the tradeshow graphics and the in-house group does the collateral materials, how can you hold anyone responsible for final results?
Not only is continuity of creative approach difficult under these circumstances, you also eliminate the possibility that someone working on one piece of the assignment will have an inspired idea for how to handle another part. It’s hard to think outside the box when your box is so tightly drawn.
And it’s impossible to hold people accountable when they haven’t been given that responsibility.
4. It has nothing to do with saving money
In-house ad departments are increasingly popular these days with business-to-business companies, but not for the reasons you might imagine. Most non-advertising managers who approve these arrangements are convinced they save money and get better results with dedicated individuals who truly understand the product and service technologies.
And while there are undoubtedly cases where that actually happens, it’s just as likely the costs are higher and results less. The primary reason has to do with overhead costs – they’re the same for in-house and outside agencies. Salaries, benefits, equipment, training, etc. are the same. I can even make the case that outside agencies pay less because creative people prefer the working environment and opportunity to pad their portfolios with better stuff.
Finding good people is an on-going challenge for in-house and outside agencies alike. If you’ve got a good team assembled, savor the moment.
5. Keeping the team together is a shared responsibility
Clients like to think they have no obligation to help outside suppliers forecast staffing needs, but they do. When they run a huge campaign through the agency in the first quarter and then little or nothing the rest of the year, what impact does that have on agency staffing and profitability? Could they do that with an in-house group?
No, the in-house group will find ways to stay busy year-round. And you should want your outside agency partner to do the same so they can keep a talented team together to serve your communication needs. It doesn’t have to be exactly level, month-to-month, because agencies have other clients and can take up some of the slack with variation in their work load. But the enlightened client is one that plans a steady flow of work through the agency year-round.
There are many myths in advertising and marketing, but the concept of agency-client relationship as a marriage is still as valid today as it was when I started in this business 40 years ago. The institution of marriage may be trending down, but the need for clients and agencies to work together as one has never been greater.