How smart is your agency?

Training is a budget line that can easily be cut in an agency – and it frequently is.

I plead guilty to having done so when I ran a WPP creative agency.

It is easy to understand why. The agency scene has been characterised by increasing competition and reduced margins. Agency CEOs are not sure of much these days, except that clients are being wooed by other agencies – and that the procurement department would like fees to be lower and tightly accounted for.

The tenure of an agency CEO is often determined by short-term financial health and so it is natural to make short-term financial decisions. Hence, the vulnerability of training budgets. But it is not a smart move. Here then is my pitch to agency managers: four compelling reasons why to invest in training.

1 Training is an expression of confidence

Investment in training is an expression of belief in, and commitment to, the long-term. In a market dominated by the short-term, it says that you believe in the future potential of your staff. Quite apart from the benefits (which we will come to), it is therefore a vital signal of confidence to both staff and clients.

2 Your staff may look dumb in front of your clients without it

I have been conducting training courses for over a decade. My general observation is that agency investment in training has declined, while clients have maintained and grown theirs. This is bad news for agencies. Why should a client believe in an agency if its people do not seem to know the fundamentals of marketing and advertising effectiveness? And frequently, sad to report, they are ignorant of the key foundation texts on marketing and advertising.

The digital revolution has sped up communications and placed more and more emphasis on the short-term and rapid response. And this has ‘infected’ what sort of marketing a brand should do. Responsiveness is more valued than brand strategy – a point of view that is exacerbated by the ‘always in beta’ culture of digital innovation. But if you stand back and ask, ‘what do these great brands do?’, a different picture emerges.

For example, I recently sat in a meeting with Mars at Google (where I was working at the time), in which the client set out her belief that the health of the brand depended heavily on new customer penetration rather than loyalty promotions. The agency people and fellow Googlers were from a digital background. They knew all about how digital platforms were developing but had no knowledge of the works of Andrew Ehrenberg and Byron Sharp on which the client based her thinking about marketing effectiveness. This is important work that challenges the often-touted belief that brands (especially FMCG brands) could remain healthy if they focused all their resources on existing heavy buyers. Ehrenburg/Sharp exposed ‘the loyal buyer fallacy’. Now, it was clear to me in the meeting that the client and agency were speaking different languages and in that moment, the status of the agency diminished from a potential partner to a mere supplier, selling their narrow, specialist skills. Clients can tell if they are dealing with people who lack important knowledge and will downgrade their views of the agency as a consequence.

3 Training helps you develop strategy, not just tactics

In my 10 years of training agency people, I have observed that they are more and more distracted and preoccupied. (It is very difficult to persuade attendees to put aside their smartphones for long). The digital revolution has sped up communications and placed more and more emphasis on the short-term and rapid response. And this has ‘infected’ what sort of marketing a brand should do. Responsiveness is more valued than brand strategy – a point of view that is exacerbated by the ‘always in beta’ culture of digital innovation. But if you stand back and ask, ‘what do these great brands do?’, a different picture emerges. Short-term responsiveness is important, but it has to be balanced with building long-term brand meaning. There is rich literature on brand building that people in agencies need to know about or they will end up being hoodwinked by those promising short-term gains.

4 Training helps you develop your critical thinking

People whose entire careers have been in digital are often guilty of the ‘Year Zero’ narrative – the contention that all the existing wisdom has been swept aside by the digital revolution and that there is a new, better and more modern way. Digital behemoths like Google and Facebook are keen to promote this idea in a bid to take a larger share of the advertising cake. But is it true? Training gives people wisdom (in an accelerated form) that helps them develop critical thinking that exposes hype.

For example: Is programmatic really a new idea, or a new technology delivering an old idea? And will consumers find it a great experience because it is ‘relevant and personalised’, or will they still feel ‘pursued across the internet’ with unwelcome sales messages? Programmatic is about to be big and you need an informed view.

Is the Facebook advertising that you see in your timeline really different from TV advertising, or is it just another (and possibly less welcome) form of the ad interruption model (albeit better targeted)?

And here is a really big one: with the huge increase in information now available online, are consumers becoming more rational, or are they still just as driven by emotion, ‘mental shortcuts’ and insecurity as ever? Your views on the last debate can cause you to make either good or bad decisions about where you invest your budget. To unpick this debate, you should familiarise yourself with the science of decision-making (also known as Behavioural Economics, which I have written about previously for Aurora).

Is programmatic really a new idea, or a new technology delivering an old idea? And will consumers find it a great experience because it is ‘relevant and personalised’, or will they still feel ‘pursued across the internet’ with unwelcome sales messages? Programmatic is about to be big and you need an informed view.

So, what to do? Where do you start? Here is my initial plan.

Champion training through trade associations

Agency managers and trade associations should get together and create a curriculum. It needs to be competitively priced because agency margins are not going to be fatter any time soon. Importantly, trade associations such as the Pakistan Advertisers Society (PAS), also need the support of agency CEOs to ensure that they get the number of attendees to make the courses viable.

Wisdom and new knowledge

The curriculum needs to cover classic thinking and new thinking, but not be captured by either. For example, the Institute of Practitioners in Advertising (IPA) Effectiveness Awards (started in 1980) are full of wisdom about how advertising works that is just as relevant today. At the same time, the way the APP brands on your smartphones are built is new – they are in the attention business and use habit-forming designs to build and maintain ‘users’. Nir Eyal is very insightful about this new way of brand building.

Ready-made curriculum

Five years ago, I designed such a curriculum for the Marketing Agencies Association, UK; we have sold out this course every year and continually refined it using feedback from attendees. You can find it here: bit.ly/2xiQRbk

I am not saying you should replicate it – but it does provide a starting point to build on.

In August, I ran a course for PAS in Karachi and Lahore called Brand Building in the Digital Age. I found people hungry for knowledge and several asked me for a reading list so I have posted it on Aurora’s website – along with tips for those who are time-poor about how to access this knowledge in digested form.

I will end with an old idea; a direct response technique that has not gone out of fashion – a call to action: “Calling all agency managers – get in touch with PAS this week and give your trade association support!”

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