Turf War?: Consultancies and Agencies

Consulting firms have always sized-up the marketing space as a potential service offering. They have flirted with it for decades. Most large-scale forays have ended up in retreat after just a few years. Meanwhile, ad agencies have long-looked to shore up their dusty, old revenue models and expand by purportedly delivering more strategic offers. This too, has been largely episodic and unsuccessful.

Stick around and I will tell you why neither have historically worked but why they may work now. First off let’s substantiate that this mash-up is taking place:

  • Eight of North America’s top 10 agencies are owned by consultancies. Accenture has acquired at least 40 of them. Deloitte, Accenture, KPMG, PwC, and McKinsey now have agency arms.
  • Deloitte is out to create “the world’s first creative digital consultancy.” Meanwhile, IBM’s digital agency unit, iX, has over 10,000 employees and 1,000 designers in 25 offices worldwide.
  • Del Monte Foods selected Epsilon as its U.S. creative agency of record reflecting a fresh focus on data-driven marketing and a move away from traditional advertising agencies.
  • PwC made waves in 2016 when they appointed their first Chief Creative Officer. It should be noted that PwC also named a Chief Purpose Officer, which seems very much like an agency-thing-to-do.
  • Omnicom created Hearts & Science, an integrated digital agency leveraging technology to scale customer relationships. It has attracted Proctor & Gamble and AT&T as clients.
  • Razorfish, a division of Publicis Groupe, partnered with Adobe to build its own digital marketing platform.
  • Starcom MediaVest Group launched marketing consulting brand Zero Dot and sibling Zenith soft-launched a media-focused consultancy called Apex.
  • R/GA and GroupM now offer broad-based consulting services for the purposes of higher margins while securing traditional ad business. This is the strategy of O&M’s strategy consultancy, Ogilvy Red. Carla Hendra, global chairman of Ogilvy Red, is quoted as saying, “If we sell $1 of consulting work, down the road it can lead to $3 to $4 dollars of communications work.”

Clearly, traditional lines are crossing and blurring but why?

Read more

Revitalizing a Wine Brand

I was born in 1965 in Winnipeg, Manitoba. That sentence reads like a dual confession and I have one more to share before this is over but we will get to that shortly. Any how, from the 1960’s to 1990’s, wine took a backseat to beer and spirits in Canada. In Manitoba, Old Vienna beer and any rye brand dominated for decades. When wine did grace the table or flowed at a party, invariably it was Black Tower, Blue Nun, or Baby Duck.

Black Tower suggested Teutonic dominance with its once clay bottles. Blue Nun had a pleasing name and label that implied organized religion had blessed your choice. Baby Duck was hugely successful. It sold 8 million bottles in 1973 alone. The name prompted many imitators. In the 1970’s, you could buy Canada Duck, Love-A-Duck, Kool Duck, Daddy Duck, and Fuddle Duck (say this last one three times fast). One brand even tried a poorly thought-out deviation and went by the name of Cold Turkey.

With all due deference to Black Tower, Blue Nun, and Baby Duck, they were outclassed by a fourth 158243774_-mateus-rose-pink-wine-bottle-candle-brazil-nuts----1powerhouse. Do me a favour. Close your eyes. Now picture a wine bottle unlike the standard. In this one, the 750ml of wine was contained in a squat teardrop shape. Remember it? I am speaking of Mateus. Following consumption that bottle often housed a succession of candles in its tapered neck. Waxes of different colours would run together in pleasing collages. In Manitoba, drinking Mateus and displaying the empty bottle as part of your household decorating suggested European refinement at its best (I am not joking).

Now take a break and allow yourself an eye-roll or laugh. Everyone pokes fun at Mateus. They attack the quality of the wine and claim in a self-deprecating way just how silly they were to ever drink it in the first place. Still, this indicates a fond nostalgia that the brand has never capitalized on. In its heyday, Mateus sold 4 million cases annually in the United States alone. The wine’s owner, Sogrape, now makes less than 2 million cases a year in total. This, to me, is a huge opportunity.

Read more

Jeff Chats Canadian Brands

This article originally appeared in The Globe and Mail.

It works for Canada Goose, but how far can ‘made in Canada’ go? by Shelley White

Sun, sand and surf are not three things we’re internationally renowned for in Canada. Yet one of our hottest exports of the moment is Shan, a line of chic, high-end resort and swimwear that is designed and manufactured entirely in Laval, Que.

In addition to flagship stores in Montreal and Toronto, Shan has boutiques in Miami and the Hamptons, and 65 per cent of its revenue comes from the 30-odd countries it ships to, says Jean-François Sigouin, vice-president at Shan.

Shan is a line of high-end resort and swimwear that is designed and manufactured in Laval, Que., which allows it to retain full control over its product. As 65 per cent of its revenue comes from abroad, the “Made in Canada” brand works for the company because its international buyers recognize that to mean quality, the company says.

The suits aren’t cheap – they run about $300 each – but that’s sort of the point, says Mr. Sigouin.

“The philosophy of the brand is to offer quality instead of quantity,” he says. By manufacturing in Laval instead of overseas, the company has full control over its product. “We are totally vertically integrated from the design to production to retail because we have everything in the same building.”

Read more

The Best in Narrative Psychology

When you meet someone for the first time or reconnect with an old friend or go to a dinner party what takes place? Think of any situation where you are interacting with others. We share an anecdote from our day at the dinner party. We tell that old friend about what has taken place with our family and career. We attempt to connect with someone new by conveying our experiences and interests. This does not mean listing or dating activities. In every instance we use storytelling to communicate, engage, and relate.

Storytelling helps us make sense of our lives and the world around us. They are an incredibly effective method of finding and sharing meaning and context. Mary Catherine Bateson, writer and cultural anthropologist, believes that, “The human species thinks in metaphors and learns through stories.” We are hardwired for stories because we have been telling them for centuries.

Marketing and advertising practitioners continue to debate the application of storytelling in business. The most voracious advocates cannot see past the construct and even the hardiest critics employ storytelling. So why all this sharing of tales? Stories inspire and motivate. Stories make ideas stick. Stories persuade. Stories educate and entertain. That makes for good marketing.

A few years back at the Festival of Creativity in Cannes I had the pleasure of interviewing Arianna Huffington, Co-founder and Editor-in-Chief, of The Huffington Post. It was also a challenge as her handlers held me to just three questions. She once said, “People think in stories, not statistics, and marketers need to be master storytellers.”

Read more

Trends in Association Branding

Years ago I spoke at a conference focused on crafting association business strategies. This was in the late nineties while in the Marketing and Customer Management Practice at PW (now PwC). My work to that point focused on professional service businesses and consumer products. To tell the truth I was filling in for a colleague who fell ill.

The presentation went well but it was the conversations following that stuck with me. In short, I was rocked by the complexities of the industry and the challenges faced by these entities. iacpconferencephoto1-520x346Associations have always been “up against it”. All share certain issues. After working with four associations in the past two years, we have discovered the following:

Cost Not a Benefit: in many cases, members join to maintain accreditation or there is a penalty for not keeping membership but not necessarily claimable upsides.

The “Nonprofit” Label: it suggests a softer culture, less talented employees than the private sector (but stronger than the public sector!), and lack of depth and sophistication in leadership, management and planning. Let me be clear…this is perception not reality.

Overlap: one only has to look at the marketing and advertising industry to see that an agency in the United States could belong to easily over twenty different associations. Imagine being a retailer or in healthcare and that number is many times higher. This makes it important for associations to differentiate. When you think about it associations are competing against every other association out there and be held to the standards of the best. Also note there are associations for every conceivable group in the world…there are even several associations for associations!

Read more

The High Cost of Poor Business Writing

Hello dear reader. It is important for you to know that I labored over every word in this post. Oliver Wendell Homes said, “carve every word before your let it fall.” For tone-of-voice I strove for “friendly academic and passionate advocate”. Then I asked, “What do I want the reader to remember?”

I love to connect with people through writing. I do a great deal of business writing and have been encouraged of late. This skill and practice is under scrutiny. Its poor quality leads to inefficiency and ineffectiveness. I am encouraged because we are beginning to recognize the magnitude of the problem.

Josh Bernoff recently wrote in The Daily Beast a piece titled, Bad Writing Costs Businesses Billions. Bernoff has been a writer for 30 years and just published, Writing Without Bullshit: Boost Your Career by Saying What You Mean. The article grabs with an amazing statistic. It seems that bad writing is costing American businesses close to $400 billion every year. That is a staggering number.

Bad writing is costing American businesses close to $400 billion every year.

Bernoff writes, “Think about it. You start your day wading through first-draft emails from colleagues who fail to come to the point. You consume reports that don’t make clear what’s happening or what your management should do about it. The websites, marketing materials, and press releases from your suppliers are filled with jargon and meaningless superlatives.” The last sentence resonated with me. I am on a mission to ruthlessly, creatively and intelligently improve my own writing. This is a demonstration for to do the same.

Read more

An Ad Agency Tipping Point

Starting any business is a bold move. Not all survive and few truly thrive. Those that do face the challenges of managing growth and staying true to what made them successful in the first place. This is an interesting tension that I recently discovered in working with four advertising agencies.

These businesses had grown to 100 or more staff. Of course, that metric in, and of itself, is not an indicator of sustained success. The good news is the agency leaders know that. In fact, these leaders were concerned because interesting things happen when the payroll hits 100. Here are some issues that arise:

  • Agencies of 15 or 30 or even 75 employees possess a start-up or boutique feel. When you hit 100 this weirdly begins to dissipate.
  • You don’t know everyone any more. Small agencies talk of being saatchi-saatchi-office-funkt-1“family” where everyone has each other’s back. While a strong culture can keep this rolling as staff size grows, it cannot mitigate the realities of being larger. This is compounded when they open up other offices.
  • A bigger payroll and presence prompts new business pressures. This can mean chasing the wrong work to keep the machine humming.
  • Founders and principals move from client service oversight to functional roles. Marketing, people, service and product development and other areas need full-time leadership. This transition can be bumpy and skill-sets are stretched.
  • Specialisms and differentiators begin to lose their luster. You simply cannot make the same claims. Being “nimble”, as an example, gets called in to question.

Read more

Ad Agencies Need to Obsess About Loyalty

The company, Access Development, tracked and recorded, and recently shared every publicly available piece of data available concerning customer engagement and loyalty. They call it the Ultimate Collection of Loyalty Statistics. These data points, insights and themes are interesting unto themselves but add up to one big fat fact they did not note…any marketing business is in the business of loyalty.

I mean advertising agencies, marketing consultancies, public relations firms, market research bureaus, digital agencies, performance marketing shops, telemarketers, brand consultancies, social media marketers, media buying services, promotional material providers, influencer and celebrity marketing 200464106-001advisors…well, you get the idea. Any agency, firm or service that is in the business of marketing exists for one purpose. Of course, this includes those prescient to be specifically in the business of loyalty marketing.

The past, present and future of marketing has and will always hinge on loyalty. No company wants a one-time customer. Even businesses selling bomb shelters in the 1950’s wanted a client’s second home or to upgrade the first. Apple wants to sell customers a new cellphone every time there is a new release or every 22 months which is the smartphone adoption average.

Agencies and consultancies continue to talk about brand positioning, awareness, consideration and trial. Important stuff for sure but only the start. All efforts and spend should have loyalty as the end goal. Anything else is a dodge, a feint, a run from the real focus and fight.

Not one single advertising agency, brand consultancy, PR firm, media buyer is really talking about loyalty.

I see not one single advertising agency, brand consultancy, PR firm, media buyer talking about loyalty. This leads to churn, inefficiency, ineffectiveness and the regurgitation of the same ideas whose only result is a client’s frustration and dissatisfaction…and poor results.

Why spend money on branding and advertising if not to have repeat customers?

Let me say it again, no company wants a one-time customer. That is why marketing’s purpose is loyalty. You only need to give a cursory examination of Access Development’s aggregation to arrive at the same conclusion. We thank them for the following…and for also proving loyalty programs are a tactic not a strategy.

Read more

The Real Reason Clients Hire You

I have spent my career in professional services. From Price Waterhouse to Interbrand to DDB to now running my own agency. Over that time I have become an expert in branding and marketing professional services. At least that is what peers and clients say. To make that claim myself is analogous to me telling you that “I’m cool” or “I’m funny” or “I’m smart”. The credibility is in others saying it. Having others speak well of you is the goal of branding.

This specialty allows me to work with law firms, management and marketing consultancies, advertising and digital agencies, and accounting firms. An engagement with an investment management firm led to an insight about how and why clients truly decide on one professional over another.

screen-shot-2016-09-20-at-8-58-40-pmFor a long period we assumed that clients first and foremost chose expertise. This assumption led ad agencies to talk about themselves way too much, law firms to numb clients with superior high-minded jargon, and management consultancies to dazzle with mysterious black boxes of proprietary processes. To their credit many professionals identified this as a problem but mistakenly identified the solution. They chose to switch emphasis and focus on the prospective client’s situation.

Read more

Ad Agencies Confuse Public Relations with Branding

Perhaps we can lay blame on the Creative Revolution in advertising from the early 1960s. That era of broadcast communications produced, on a relative basis, the largest volume of advertising we have ever seen. It is viewed as the pinnacle of Madison Avenue’s influence. At the same time, the public relations profession was having its own golden days. The masters of spin were as sought after as the martini-soaked mad men (apologies for reinforcing the stereotype).

Soon competition among ad agencies grew in the late 1960s and the phone stopped ringing. Work dried up so agencies turned to their public relations cousins for help. From the mid ‘60s on, this meant pumping out press releases and cultivating media to cover agency activities. Most of this trumpeted new business wins and awards gained at the ever-increasing number of shows. This contributed no real or meaningful differentiation especially given all agencies followed the same playbook. The biggest innovation agencies introduced in subsequent decades was hiring public relations professionals to work in-house.

TheOffice

Read more