100 Staff: An Advertising 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.

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Every Agency Needs 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.

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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.

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What Ungava Gin Has To Do Now

I first tried Ungava gin about three years ago. We live in Mont Tremblant, Quebec and the local Société des alcools du Québec (SAQ) was showcasing this home province concoction. To tell the truth, the color of the product was a tad off putting. Rarely do you see a gin that resembles a substantial urine sample. According to the company website, “six rare botanicals give Ungava Canadian ungava-bottlePremium Gin its particular aroma and colouring.” Suffice it to say, it is yellow.

I am a vodka man but love a G&T in the summer. Vodkas are largely undifferentiated to me in taste. Perhaps I have burnt out my taste buds but I cannot really distinguish between a Stoli, Grey Goose or Absolut. Yet, when it comes to gins, I taste the difference.

In the case of Ungava gin, it is distinct. It is both rich and smooth. The marketing speak about rare botanicals has truth to it. There is a pleasing complexity in the mixture. The site claims, “an original recipe is produced in a traditional way: Nordic juniper, wild rose hips, cloudberry, crowberry, arctic blend and Labrador tea are naturally steeped until the gin takes on its complex flavour and distinctive sunny hue.” Sunny hue is a much kinder description than urine.

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Remember When Marketing was About Selling?

Checkout these thought posters and share them widely. They address brand storytelling, the loss of meaning in branding, the need for real results, and how marketing must get back to selling.

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2Brand

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Social Media Officially Failed on February 7, 2009

I often joke with clients and audiences at conferences that social media officially failed on February 7, 2009. It is a completely arbitrary date. My point is, around that time it became clear that the promise of social media would go unrealized. That promise being that social media would be premised on conversation.

Instead what happened is brands and their agencies feared lack of control over dialogue. Ceding that control to customers was a scary idea. So they reacted by using social media as just another broadcast tool. They fell back on their comfort zone as in television, print and radio. Years later this persists.

This is not to say brands are shying away from social media. In fact, Forrester predicts $16 billion in spend in social media by US marketers alone in 2016. Lithium, the owner of Klout, that tracks social media influence, commissioned independent research firm ComBlu to take a look at social media. According to their site, “Combining hard numbers with human analysis, the State of Social looks at eight industries and 85 Fortune 1000 companies to determine how strategic and effective brands are across their social ecosystems.”

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Before we get to the insights it is important to state that though I am on Klout, I am not sure of its ultimate value. An aggregate score based on my social media activity has not caused me to alter anything when it comes to social media. And it is clear this report has an agenda and that is to further advance the idea that influencer marketing is valid and works. Social media was always intended to be an egalitarian grassroots tool. Obviously some will attract more followers than others but that should be based on their value and relevance rather than by a campaign using brand dollars.

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Why Marketing and Marketers Love Fads

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Fads are fascinating. They pop-up, wildly peak, and rapidly become a memory. Fads are defined as, “an intense and widely shared enthusiasm for something, especially one that is short-lived and without basis in the object’s qualities; a craze.” Marketing has historically loved a craze because it enjoys significant awareness.

Social media has helped fuel fads and arguably shorten their shelf life. Fads are similar to habits or customs but less durable. They often result from an activity or behavior being perceived as emotionally popular or exciting within a peer group or being deemed “cool”.

Dance marathoners hoping for a sponsor's prize.

Dance marathoners hoping for a sponsor’s prize.

Nowadays they are promoted across social networks growing trial and converts to the fad. Think about the Ice Bucket Challenge and you will get the drift.

This ties to the bandwagon effect. This is a phenomenon where the rate of uptake of beliefs, ideas, fads and trends increases the more that they have already been adopted by others. Marketers love the notion of fads and bandwagons as they resemble interactive advertising campaigns. Marketers strive to create fresh fads and compel the bandwagon effect or they associate their brand with a fad currently underway to gain a halo effect.

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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.

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Marketers are from Mars

Marketers are from Mars – Consumers are from New Jersey Book Review

This is Jeff’s review from Amazon…

The author has written an eclectic rant. I am in branding, marketing and advertising but had not heard of Bob Hoffman until I happened across this book. Right upfront he recognizes that people in the industry are “funny, cynical and immature bastards”. Based on personal and professional feedback I would seem to fit that criteria. As such, I did enjoy the first third of the book but then it grew so sardonic and acidic that it was hard to appreciate the lessons in the messages.

Advertising is a funny practice and profession. It is revered and reviled in equal amounts. I appreciate the author’s attempt to hold it accountable and I totally agree that it has too long been focused on fancy tricks instead of recognizing the tried and true. Rather than dissect the contents, let me provide a few standout lines that resonated (these are not spoilers):

– Hoffman writes that the marketing industry is under mass delusion that includes “the gross exaggeration of the role of brands; the mangling of the role of ad agencies; the mistaking of gimmicks for trends”

– “Marketers are taught not to think simply.”

– “Advertising has always been 90% lousy, but online advertising has set a new standard for awfulness.”

– “most of what we call ‘brand loyalty’ is simply habit, convenience, mild satisfaction or easy availability.”

The book is a series of short essays and blog posts so you can pick and choose topics that interest you. Coherence and consistency are tested but the feisty and testy ad veteran tone reverberates throughout. He sounds too bitter for someone who made his career in the profession. Having said all that, if you read only one entry, make it, “Here’s to the Bobbleheads.” This one rant will be recognizable to anyone in business.

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A Collection of Business Storytelling Stories

We share a collection of business storytelling articles that offer value. These are both recent and go back a few years but all support the effectiveness of telling the right tale right.

Why Storytelling Will Be the Biggest Business Skill of the Next 5 Years (HubSpot)
“Those who tell the stories rule the world.”

The Irresistible Power of Storytelling (Harvard Business Review)
A Strategic Business Tool.

Why Companies Need More Novelists (Fast Company)
Leaders, take note (and MFA grads, take heart): acclaimed novelist Mohsin Hamid on the most quote-Tim-OBrien-storytelling-is-the-essential-human-activity-the-135637important tool you’re not using enough.

Product Narrative: How to Use Fiction to Get Your Story Straight (Inc. Magazine)
David Riemer of the Haas School of Business explains why story telling is so powerful.

The Inside Story (Psychology Today)
Success in the information age demands that we harness the hidden power of stories. Here’s what you need to know to tell a killer tale.

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