Something's up in the advertising business. Over the past month (January-February 2006) three events took place. Events the likes of which I've never seen before in all my years in the advertising game.
The first 'event' was reported in the January 11, 2006, edition of the Wall Street Journal that Toyota VP-Marketing, Jim Farley told Publicis Groupe SA's Saatchi & Saatchi "... the ad pitches for two of this year's sales promotions turned consumers into props." Then, further on in the article, Farley states, "I'm not hearing the consumer," he says of the ads. "These ads are about the company's agenda. It's just not relevant to the consumer."
It's not unusual for a client to register displeasure with its creative agency if, in the client's opinion, the ads are not working. What struck me as most interesting was that Farley's admonition to Saatchi & Saatchi went public in the high-profile Wall Street Journal. I read it as: The agency has been warned.
Next event.... Advertising Age reported (Jan 30, 2006) that Ford Motor Company hired Accenture to go over Ford's marketing plan with microscopic scrutiny. One may be prompted to ask the nature of Accenture's business; well here's what it says on the company's web site: "Accenture is a global management consulting, technology services and outsourcing company. Committed to delivering innovation, Accenture collaborates with its clients to help them become high-performance businesses and governments. With deep industry and business process expertise, broad global resources and a proven track record, Accenture can mobilize the right people, skills, and technologies to help clients improve their performance."
Is Accenture qualified to judge Ford's marketing plans? One of the services Accenture offers is under 'Consulting' and sub-headed, 'Customer Relationship Management. Does the company claim to know anything about advertising? Not that I can easily discover from the web site. The collective of ad agencies for Ford is under the jurisdiction of WPP Group, and the Group's owner, Sir Martin Sorrel has often warned the ad industry about the threat posed by management consultants muscling into the business. It's officially happened at Ford. Will Accenture begin to replace Ford's ad agencies? Right now, we do not know, but as I read it: The agency has been warned.
Next event: Verizon's VP-CMO-Wireless, John Stratton, as reported Feb. 9, 2006 by Ad Age publicly told advertising agencies that they have got to figure out emerging media – fast – or "lose billions of dollars to someone who will...". Stratton's admonition was delivered to marketing, media and content producers at Advertising Age's 'Madison & Vine Conference' at the Beverly Hills Hotel. I infer from Mr. Stratton's words: The agencies have been warned.
As I previously stated, the public 'slam-down' of the advertising industry surprises me. From my past experience, such 'admonitions' have been carried out in private.
What to make of this business? My answer is based on actual experience: The agencies had better watch out. They don't need me to tell them what they already suspect: their major clients may be preparing themselves to go down the marketing and advertising road alone. Very likely there are people inside Toyota, Ford and Verizon who believe they know their products better than any outside agency, and because of such knowledge, also believe they know their customers better than any outside agency. Therefore, the clients feel empowered to take over their advertising and manifest it themselves. I witnessed such a process happen within one of the largest pharmaceutical manufacturers. An internal creative group was established, the outside agency connections were severed, and the internal group produced the full spectrum of print advertising and sales promotion tools that were deemed superior to previous agency creations.
Ford, specifically, is in a hurting situation. By now, we're all familiar with Ford's story ... and GM's story... and to a lesser extent, Daimler-Chrysler's story: their cars, trucks and SUV's are not selling. Forget the fact that some of the cars offered are unattractive; some trucks offered really don't function as work-horse trucks; some SUV's are stupidly big, outright ugly and overall, when grouped with the trucks, are gas guzzlers. What's wrong with the American automotive companies rests at a level that's far deeper than marketing and advertising. But, the reflexive thing to do is blame advertising for not doing its job. Well, let's see what Accenture comes up with. Let's see what they recommend. Let's see if the agencies are, in the end, vindicated.
— Don McKay
