Why ad agencies need to move beyond the 'client-servicing' model and become strategic consultancies for their clients.
The advertising industry in Pakistan faces a strange dilemma. On one hand, the industry is growing. On the other, agencies are becoming increasingly prone to hyper competition, commoditisation and globalisation. I have touched upon these topics in previous articles as well.
In my view, the key purpose of an agency is to create differentiation. After all, how can an agency that cannot differentiate itself be able to create meaningful differentiation for the brands it handles? Agencies are subject to the Darwinian principle of the survival of the fittest.
Agencies have traditionally differentiated themselves on the basis of their creative product. The advertising practitioners of yore were specialists at creating beautiful jingles and catchphrases that captured the hearts of the consumer. Advertising was a craft, mastered by a select few artisans. Words were meticulously crafted and visuals were painstakingly composed. As a result, advertisements seemed quite original and unique.
Today, the process has become so much easier. One can easily google ideas, sift through massive advertising archives for inspiration and get excellent visuals from the likes of Shutterstock. We also have YouTube for TV commercial inspiration. What used to take weeks to craft, now takes hours. The sameness of the advertising output across different agencies in Pakistan is not surprising, as they all seek inspiration from the same pool.
For many agencies, the real differentiation is in their personal relations with the client. The reality is that a lot of agencies hang on to their clients simply on the basis of personal relationships.
The client-servicing model
The most prevalent agency model I have observed in Pakistan is something I call the ‘client-servicing model’. This is the advertising industry’s way of following a consumer-centric approach, which sounds great on paper.
This is how the approach works: Keep the client happy at work and outside work; avoid challenges and confrontations with the client; always stay within the client’s comfort zone and never make him/her feel insecure; be there to take the fall for the client every now and then, so that he or she can look good in front of their management; maintain a team of excellent showmen who can constantly wow with their presentations and passion for the client; predict what the client is going to like and approve, and don’t bother much with work that is not likely to get approved.
While the approach may sound sensible, it also leads the agency down a path of subservience. It kills the process of innovation within the agency. It creates a culture that rewards the average and good, while punishing the great.
Agencies as strategic consultants
Some years ago, I attended a training course conducted by Peter Doyle, probably Europe’s best known marketing and academic guru at the time. He predicted that agencies must become more like strategic consultancies if they are to survive and prosper over the next few decades. I am sitting in 2017, and I can truly relate to the wisdom of his words.
Going back to the Darwinian reference I gave earlier, brands can easily substitute their creative, digital, activation, media and PR partners, as there are so many options available in the market, without harming their brands (sad, but true). On the other hand, brand owners would be highly hesitant to let go of the strategic consultants who help their brands navigate through increasingly turbulent waters.
Consultancies legitimately command significant premiums over traditional agencies. They sit higher up on the food chain and much closer to the brands’ decision makers. They are unafraid of challenging the client when necessary and therefore become incredibly valuable for the brands they work with. After having had the opportunity to work with Booz & Company (now Strategy&), I cannot be more convinced that this is the direction advertising agencies should take in Pakistan.
How you can turn your agency into a consultancy
Consultancies differ from traditional advertising agencies by the approach they follow and in the way they are structured.
In terms of approach, they are also service driven, but not client-service driven as typical advertising agencies are. They listen carefully to the clients, stakeholders and consumers. This does not mean that they endorse the clients’ point of view by default. Doing so would tremendously compromise their position as trusted advisors. They realise the client is ‘not’ God. They go to great lengths to ensure that they have the right data and research before they make definitive recommendations. They ensure the approach they recommend is result-oriented and measurable. A consultancy that loses its credibility will lose its worth in the market very quickly.
In terms of their structure, they carry a strategy lead team with credentials that are drool-worthy. Then they maintain a panel of experts in different respective fields of interest to the client, so that they have the capability to provide holistic solutions that embody communications as a part of a greater whole. More substance than style.
There are a few other realities faced by consultancies. Brands have very high expectations regarding the consulting organisations’ ability to come in and quickly turn around difficult strategic problems in a short period of time. This is not easy, and it drives more of a project-based engagement model. Consultancies are more often seen as fixers, rather than partners who stay with clients forever.
This shorter term engagement model may quickly become a reality for advertising agencies as well as our market (and the world) becomes more and more competitive. I feel it is much better to be high up on the food chain and develop highly differentiating capabilities rather than hoping for a relatively safe and subservient existence to last forever.
There is no escaping the future or market dynamics. The best way to predict your organisation’s future is to create it. On that train of thought, I would be delighted to see agencies rise up to becoming vibrant and dynamic consultancies with excellent creative abilities.
Now, that’s a killer combination!
Afzal Hussain is COO, Pirana and Director Strategy, M&C Saatchi World Services Pakistan.