Ad agencies and holding companies need a Plan B – so just what exactly is that?
As prospects remain uncertain for adland across the globe, Michael Farmer argues holding companies should focus on rebuilding, not squeezing, their agencies.
We’re all familiar with the concept of ‘Plan B’. It emerges out of the haze when Plan A has self-destructed for one of a thousand reasons.
It’s when an unexpected snowstorm cancels our flight. When you have to scrub a key meeting. Too bad. On to Plan B, even if there is no Plan B – we’ll have to improvise.
So it is for ad agencies and holding companies today. Plan A is not working. Profits and growth are drying up, and it’s hard to recruit and retain talent.
A great read. Using data to make creative decisions makes a lot of sense. The holding companies should be providing the platforms to make this happen at an Agency level.
Agree Plan B is needed. It is also crucial that the ‘old style’ agencies rethink their creative process as well as the business model structure. The concept that they make their income based on head hours is no incentive for efficient creative workflow, and multi-talented teams to be on board. Agencies end up seeing more and more write offs as well, which just ends up reporting badly for their profitability so it is in their interest to do things differently.
The ‘Hollywood Model’ in film production is a proven model to scale up and down and to resource the very best talent for each specific project. No down-scaling of talent experience for cost efficiencies that agencies keep struggling to find which also seems to fuel an industry wide age bias – not because the ‘youth’ are more creative but purely for cost factors. By doing things different there is no shoe-horning of available talent into jobs they are not right for either.
I was recently in a meeting where the head count had to have hit $16,000 with no measurable outcome. That has to change for the industry to thrive.
Time to be doing something different here.
Great read. Of course, the big question still lies in whether the holding companies really know or trust anything other than squeezing?