I have met with a many advertising agencies both as an agency search consultant and as a New Business Development person. I have attended numerous conferences and have heard a variety of client and agency speakers all say the same thing. Most advertising agencies are all alike. Agencies listen and nod but nothing changes. Agencies go back to their same Old Normal when the world is changing rapidly under their feet and the trap door is about to open.
I have sat in numerous meetings at agencies with client prospects or new clients. Often the clients have parity products with no differentiating product benefits from their competition in a cluttered category where the consumer has plenty of choice. They don’t engineer anything of their own and have no proprietary advantages. They say things like we are currently sold on price but want to take it another way. There is nothing to take anywhere. There is no point of difference. It’s a fruitless journey but if they have a budget the train will leave the agency station. The Choo Choo of revenue.
The agencies all say the same thing. We’d love to help you. This could be an interesting opportunity or our agency thrives on challenges. Lots of smiles and bobbing heads on both side of the table. That’s great the client says. The monkey dances for peanuts. It is the burden of an undifferentiated agency. The agency smiles and walks the client to the door.
When the client leaves the agency gathers around for the debrief. What are we going to do with this? They’ve got no point of difference, they have nothing to sell. Let’s see what we come up with is the conclusion of delusion. The agency will go away and launch a campaign that has very limited chance of success.
Agencies attract those types of clients because they are those types of companies as well. They do not have a unique positioning because they don’t spend time marketing themselves. They are the same commodity only in different categories. Since they have nothing unique to sell they often just differentiate on price. They also drop their drawers often and give away their ideas for free because they have no choice.
They are on a path to extinction because this strategy isn’t sustainable in the New Normal.
I remember visiting an agency in Lincoln Nebraska when the world was melting in 2009. I was speaking to the local AMA Chapter but stopped in for a visit. I met one of the agency principals and I asked him how many people work here? 120 he said and we haven’t had to let another go. That was a great achievement in those days when almost 3 million people lost their jobs in 2008.
So what do you attribute your success I asked? We have expertise in these four categories and that is all we chase. I had read his Linkedin profile and pointed out that he had experience in the healthcare vertical I said. Do you chase that? No is what he said. We focus on our differentiated four verticals of expertise. Nothing else.
I didn’t think that focusing on vertical expertise was the top tier of uniqueness but it was enough to make them a success. Most agencies just focus on nothing and just let things ride. It is going to be a short journey.