Opinion

The case for independent, locally held agency relationships

According to DPR&Co co-founder and agency principal, Philip Huzzard, the value of local agency ownership is crucial. Here's why.

It’s a widely known fact that airliners can be pre-programmed to fly, and even land, without the direct input of the on-board flight crew. But would you ever board an aircraft where the person in control has no real skin in the game? Things go wrong in the air that require every ounce of skill and instinct for self-preservation of a superbly trained crew working together to get themselves (and you) safely on the ground. That’s why I’d never leave the gate if not in the hands of real people in the front of the plane.

To draw a comparison between a commercial airline crew and the management of your agency may seem like a stretch, but there’s some truth to the analogy. Any great CMO is deeply and personally invested in the success of the campaigns they commission. They know their career, their ambitions and their future as a marketing leader are all riding on the outcome.

Over my years as an agency leader, I’ve learned that there is simply no substitute for taking the success of our work personally. As one of the people my clients place their trust in to ensure the success of their marketing investment, I feel a deep sense of accountability for the effectiveness of our work.

And if I were a client, I’d demand to know that my agency was as driven to succeed as me. That’s a level of connection that’s difficult to achieve in a relationship with a multi-national agency network.

Certainly, many global firms have amazing talent in their teams. But they work to rules established in London, Paris, New York or Tokyo that have shareholder value as their priority. The failure of medium-to-large-sized Australian client’s campaign is a blip on a financial spreadsheet to their stockholders.

Even experienced marketers are sometimes unaware of how concentrated the ownership of the advertising and media sector has become over recent decades – both in Australia and abroad. A small number of holding companies now control all the agency brands you’re most familiar with.

The most senior people at a multinational agency are salaried employees. Their career prospects are aligned to their ability to deliver profits to the parent company – a goal that may or may not be in your brand’s best interests. By contrast, independent owners can recommend bold strategies to clients in their local marketplace, even if it means sacrificing immediate profit for longer term gain.

Then there’s the issue of transparency. As retail strategy and innovation specialist, Intuit’s Jeremy Blum puts it: “By and large, independent agencies are far more transparent about their people and processes. This ensures clients completely understand what they’re getting for their investment, as well as allowing them to contribute more freely.”

Multinationals also deal with issues of client conflict more often – and not just in your local market. A holding company that has a major telco in a region may pitch and win another, separating the two accounts with walls of ‘confidentiality’ that can leak like a sieve. This structure may avoid the appearance of conflict, not the conflict itself.

Perhaps the biggest issue for multinationals, however, is that they can suffer from uniformity of culture and ideology. Multinational boards must pacify an array of stakeholders – governments, NGOs, activist shareholders etc. – in the holding company’s country of origin. This can give their various agencies a uniformity of style that tends to make your brand blend in, rather than stand out.

Through all of this, the gap between the client and those in control of their agency becomes wider. That’s a gap that you as a client may never notice… until there’s a problem on the flight deck.

Philip Huzzard is the co-founder and agency principal at DPR&Co.

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