Why agencies have to transform their operating model in order to meet the imperatives of speed, agility and relevance.
April saw the sixth edition of the Pakistan Advertisers Society (PAS) Awards. These were, on the organisational and attendance front, by far the best ever since they were instituted in 2011. The event flowed smoothly, the hosting was good and the entertainment enjoyable. Most importantly was the attendance; the industry, of course, was there in numbers, but perhaps more gratifying for the organisers was the fact that they were also able to draw in people from outside the profession, suggesting that the event is becoming a must-attend one among Karachi’s well heeled society butterflies – and for this credit goes to the PAS organising committee.
Now to the quality of the work. According to the PAS, this year there were approximately 300 entries, up by 15% on the previous year and the highest ever so far. Yet, barring a few rare gems – and they must be celebrated for their storytelling technique, ability to engage, and in many cases for the well executed humour (which should put paid to the notion that Pakistanis don’t ‘do humour’) – the entries were mostly non-descript efforts. Bottom line, Pakistani advertising is just not able to reach critical mass. As a result, PAS judges are subjected to the grind of evaluating run of the mill work, until suddenly one of those rare gems pops up and it is a no brainer that in all likelihood the top scores will go there. This is not how it should be. PAS judges should be evaluating mostly quality work; quality that will make scoring harder – because the judges will then be contending with five brilliant ad(s) in a category of 10 entries, instead of just one (or let’s be generous, two) brilliant ads among 10 mediocrities.
So where does the problem lie? Well, as our cover story suggests, it is complicated. Clients are cutting costs; clients are opting for small creative hot shops; agencies cannot rely on long-term client relationships; talented people don’t want to join the business because the pay scales are low and the timings terrible...
So, is it a case of moan, moan, and moan some more? To an extent perhaps, but this should not belie the reality of two interlinked issues that are undermining the ability of Pakistani agencies to produce work that is consistently good, if not always outstanding. The first is that their revenue streams have been compromised and the second is a lack of vision among agency owners.
Yes, clients have put the squeeze on their advertising and media agencies, pressurising them to cut commissions and lower fees. Furthermore, long-term client agency relationships are a thing of the past and clients have little compulsion to hire hot shops on an ‘as and when’ basis; added to this, pitches are held at the drop of a hat, forcing agencies to spend time and money on pitches, which are often notional in intent.
The issue is that agencies have given in to these practices. Rather than stand firm, they have opted to undercut one another in order to retain their client’s business. As a result, commissions and fees have gone into freefall and there are no benchmarks left. It is the difference between walking into a branded flagship store where prices are fixed and haggling on the footpath. As consumers, we know that we are more likely to find quality at the flagship store rather than on the footpath. But if the flagship store chooses to let us haggle, then why blame us for doing so? Why blame clients? When pricing goes into freefall and there are no benchmarks to judge quality, what can they do?
Rather than stand firm, agencies have opted to undercut one another in order to retain their client’s business. As a result, commissions and fees have gone into freefall and there are no benchmarks left.
So why don’t agencies get the fact that they need to put in place basic guidelines about what is and what is not acceptable in terms of commissions, fees, creative and production costs? Some agencies may not want to do this, but basic common sense dictates that those agencies that adhere to these guidelines will eventually be the ones which will get the share of the business, simply because clients will want to do business with a partner willing to provide quality at a reasonable price, rather than with the one willing to undercut their prices and who will then inevitably make up the shortfall elsewhere.
Agencies need to repurpose their vision. And not just in terms of how to reform their revenue streams. They need to reassess their entire approach. The global agency debate today is about how agencies have to transform their operating model in order to meet the imperatives of speed, agility and relevance. These are not mere words; they are realities and until and unless agencies in Pakistan are willing to address the faults in their revenue streams and move away from their comfort zones, reaching critical mass in terms of excellence in creativity and effectiveness will remain a distant hope. In the meantime, all we can do is to continue to applaud those rare gems.
Mariam Ali Baig is Editor, Aurora.