In the late sixties, David Ogilvy met a new company that had a radically new idea: instead of paying for things with cash or cheques, you to charge it to a card, which would send you the bill later. They did not have much money but Ogilvy took them on as a client. The company was called American Express. It was one of Ogilvy’s smartest decisions.
In the decades that followed, Ogilvy and Amex pretty much invented database marketing as we know it today. American Express executives moved to other companies that were hot for database marketing – and they in turn came back to Ogilvy. This led to huge wins, like IBM.
When the digital revolution happened, Ogilvy & Mather Direct (as it then was) was well placed to take the uses of data to the next level. The company’s expertise was rooted in the collecting and analysis of customer data and so the internet with its capability for collecting huge volumes of real-time customer data was a natural next step.
"The idea behind one ‘Ogilvy’ – pulling all the old silos into a more integrated, cohesive whole – is about responding much faster, with more agility and cost-flexibility to organise the right talent for our clients, depending on whatever complexity and set of needs they have; be that in individual markets, regions or globally, one aspect of our offering or all aspects of our offering.”
Ogilvy CEO John Seifert
Later O&M Direct was rebranded Ogilvy One and in time, grew bigger than the ad agency. Ogilvy as a group is consequently much stronger today than many other agencies whose expertise is in FMCG and mass marketing – they came later to the data party.
I tell you this back story to the Ogilvy rebrand and restructure that has just been announced by CEO John Seifert, because Ogilvy has the credibility to do it (and not just use it as cover to put the ad agency in charge again).
He says: “The idea behind one ‘Ogilvy’ – pulling all the old silos into a more integrated, cohesive whole – is about responding much faster, with more agility and cost-flexibility to organise the right talent for our clients, depending on whatever complexity and set of needs they have; be that in individual markets, regions or globally, one aspect of our offering or all aspects of our offering. A big part of this is about becoming a much more client-centred organisation.”
This move frankly has been a long time coming. Clients have been struggling with complexity for some time. As media became much more complex over the past two decades, agencies launched suites of specialist services – a bit like a supermarket. These became different revenue streams (different P&Ls) and increased complexity and costs to clients.
For the past 15 years, I have been running training courses for brand owners about how to direct and manage multi-disciplinary agency teams. These sessions start spontaneously with ‘war stories’ in which marketers share their pain about how difficult it is to integrate agencies and how much of their time is spent resolving disputes between agencies hungry for revenue and wishing to be the lead agency. It is a tough challenge. So, Seifert’s announcement that the new Ogilvy will have a single P&L is bang on the money.
For this to really fly, Ogilvy will have to relaunch its strategy – as advocated by Seifert’s predecessor Miles Young – because ‘integration and cohesion’ really start with thinking not ‘agility’ (important though it is for a big shop like Ogilvy to say that “Elephants can dance”). It means building an evidence-based effectiveness model that can pull all the disciplines together and provide guidance as to where clients should spend their money and where they should not.
If Ogilvy can do that, they will win and see off the consultancies which don’t have that magic ingredient of ‘creativity’.
Julian Saunders was Strategy Director, Ogilvy and Head of Strategy, McCann Erickson. He has worked on behaviour change campaigns for the UK Government and on innovation in The Zoo at Google. He blogs at www.joinedupthink.com