There was a time when the best and most notable advertising agencies in the world were known for their house-style. That is an approach to their advertising for which the agency became known and loved. Agencies are known for their jingles, their witty and charming copy, or their striking art direction.

Having just sat through ten days of the Adforum Consultants Summit, this time held remotely via online video, I think we are witnessing the rise of the agency house style again. Not from the larger network agencies, but from the increasing numbers of high-profile independent advertising agencies that are gracing the global scene.

The exciting thing is that this could be the start of a new agency renaissance, a new golden era of advertising, in much the same way as the celebrated sixties and seventies were a golden era. Or is it merely an aberration that will wither and die through lack of commercial support? Let’s hope for the former because the work many of these agencies are creating is fresh, challenging and exciting. Even if it does feel like it comes with a particular house style.

During the presentations, the various agencies would present examples of the work they had developed for their clients. These agencies came from all over Europe, Africa and the Americas. (One of the great advantages of a virtual summit.) With either 30 minutes or an hour, each agency set out to communicate their offering and impress what is considered one of the toughest audiences in the advertising world – pitch consultants.

Interestingly, it was the independents where the house-style was most obvious. It could be earnest, or dramatic, or cheeky, or playful, or visually striking. It was particularly evident in the agencies where the founding partners included one or more creative partners. It makes sense that starting their own agency they would recruit other creative resources that would have a similar creative aesthetic.

Compare this to the larger, established network agencies. Here, even the most senior and influential creative leader will inherit a creative department, rather than have the opportunity to recruit and build a creative department from scratch. At best, they can make some key position recruitments and raise the creative standard overall.

Interestingly, it is these new independents that are now being formed and led by those same creative leaders who have a track record of raising the creative standards of many of the big network agencies. But now they have the freedom to create a creative enterprise in their own image. In the process, recruiting those who share their beliefs and developing a house-style for their agency, either consciously or unconsciously.

I know there will be some who disagree and say they are developing creative solutions to the clients’ individual business and marketing problems. But the fact is, creative people are people who bring their own experience, taste, style and judgement to the role. They are inclined to surround themselves with directors, photographers, designers and – increasingly – technologists who share their vision. The same approach happens on an individual basis within the creative departments of large network agencies, except that over time, the mix becomes more eclectic as creative leaders come and go.

So is a house-style good?

But is a house-style good for agencies and their clients? From a client perspective, it certainly becomes a clear differentiator in choosing an agency. Simply by looking at the agency showcase, you are able to determine and understand the type of advertising solutions the agency would deliver. Even better if that house-style has attracted other ‘non-competitive’ advertisers the marketer admires and respects.

The comparison here is the difference between the fashion-house boutique and the department store. On one hand, you have the label that can be guaranteed to deliver a particular style and on the other you have a place where you can pick any number of styles, depending on who is working on your account.

From the agency’s perspective, while it may be seen as putting all their eggs in one basket, the fact is, at least one of the founding directors is backing their talent. The trick will be, firstly, making sure the house-style puts the agency in demand. Get this right and the second challenge is being able to scale to the size of their multinational competitors and maintain the focus on the house style.

Either way, the rise of the independent agencies has created an environment and an opportunity for particular creative styles to express themselves and flourish. This can only be a positive thing for the industry as it provides a focus on and a consideration for the style and role of creativity, compared to the blancmange of creative styles many agencies serve up.

This article first appeared in The Drum on December 11, 2020

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I was recently invited to speak at the Miami Ad School in New York to the students undertaking the 2 Year Creative Program and the Strategy Planning Boot Camp. This was an audience of young people looking to start their career in the advertising industry. The brief was to share my career, but instead I decided to share with them the valuable lessons I have learned during 35 years in advertising, including 15 years as an agency creative and almost 20 years with TrinityP3.

It was interesting because when I started thinking about what that advice would be, I realized it is a conversation that we rarely have in the industry – and that is all about the money, the money, the money.

1. How advertising agencies make money
2. How you can earn the money from the agency
3. How to keep the money you earn

Yes, I know that at TrinityP3 we talk a lot about agency fees, but these conversations are usually with senior marketers, procurement teams and agency senior management. It is rarely a conversation held with the people working in the agencies. So for those intending or about to work in advertising, here is an important and uncommon conversation. But even for those working in advertising it may be an enlightening conversation too.

Let me do this in the order I delivered it on the night in Astoria, NY.

1. How to keep the money you earn

How many older agency creative people do you think are driving an Uber today? Okay perhaps not an Uber, but definitely are no longer working in an agency? This is why every agency person needs a Plan B or should be on the look out for a Plan B. After all, it is well publicized that the advertising industry is incredibly ageist and that except for a handful of people that reach the upper echelons of the industry, a large majority end up working in either other professions or smaller creative businesses.

The Plan B I am talking about could be starting your own agency, like David Droga, but again only a small number of creative people achieve that type of success with their own business. But the audience was made up of wide-eyed 20 somethings, so for perspective, I explained that their career would be somewhere between 20 – 30 years and while that seems like a long time, the truth is that at 40 or 50 years you still have another 20 – 30 productive years in front of you.

The other problem is while advertising can pay very well for those lucky enough to have the talent and opportunities, many in advertising will find the cost of their lifestyle increases with their promotions and pay raises. Then when the inevitable redundancy comes they do not have the financial security to stop work and so find themselves having to work, rather than wanting to continue working.

That is why my next advice is, when you start working, get a financial plan and stick with it to make sure you can still enjoy life, but also build the financial security so you do not end up being seen as too old and yet still having to work. Life is a balancing act.

2. How advertising agencies make money

I asked the audience hoping for this answer and got it. “By creating stuff”. Well no. Most agency fee models are based on making money by marking up the salaries paid to their staff and charging this on to the client. In the financial arrangements people are called FTEs (or Full Time Equivalents).

Basically you will get an annual salary plus benefits (known as direct salary costs) for working for a year. Now the agency will want to be able to charge out you on a hourly, daily or annual basis at the cost of your salary plus a multiple (called the direct salary cost multiplier). The multiplier is to recover the overhead costs of the agency and a profit margin objective.

The other consideration is the number of hours you can be billed out in a year. This can vary between 1600 – 1800 hours per year. Let’s take 1800 hours as this is like 45 weeks at 40 hours per week. (The reason it is 45 weeks is there are public holidays, holidays etc). But if you work 12 hours a day at the agency instead of 8 hours a day the agency can often bill you out for 50% more and this is all revenue as most agencies do not pay overtime making you about 50% more valuable.

To make this easier to understand we have provided online calculators here  or you can download a free iOS app here.

The next consideration is your title as most of these deals are not based on your actual salary as this is confidential information. Instead they use salary ranges based on titles. Therefore many young people get excited when they get a succession of promotions early in their career, with only a modest salary increase. This is known as a title promotion as while it is cool to tell your friends and family that you are a senior creative at the agency after only a few years, the fact is that puts you in a much higher salary bracket for the client than the salary you may be being paid.

So while you are busy “creating stuff” the fact is the agency makes money by effectively on-selling your time to the client. Understanding how you create value for the agency is important in developing and progressing your career.

3. How you can earn the money from the agency

There are three main phases of an agency career: getting a job, getting promoted, and then keeping your job.

Talking to a room full of young, enthusiastic and talented young people they appeared to be hoping the industry was waiting to embrace them. Unfortunately it is not that easy and any young person wanting to work in advertising needs a strategy to get in because talent alone will not do it. It took me six months of hawking around the industry and a targeted Direct Mail campaign to get my first job.

Identify the agencies you want to work at and then target those agencies like Alec Brownstein who used a $6 Google Adwords campaign to get a job in advertising.

Once you get through the door make sure you have a job that is generating revenue (that is billable) and not a job that makes you an overhead cost (non-billable). Now is the time to start building your profile in the agency and the industry. Many creative people think that the only way to do this is winning awards, and while this is the most common strategy, it is not the only strategy.

It is also important to make sure you are adding to the business including getting involved in winning new business, having happy and high performing clients and having a good ratio of billable hours, especially in agencies that still use timesheet systems to charge their clients. Make sure you ask for a promotion and a pay raise on a regular basis. But be careful parlaying an approach from another agency into a big pay raise, unless you are willing to go to the other agency should they call your bluff.

Once you get promoted to the senior role such as Creative Director, Executive Creative Director or Chief Creative Officer, make sure you secure your position. That is not just fulfilling the creative role but also building a reputation and a way of working that attracts talent to the agency, attracts clients to the agency and keeps clients at the agency. Hopefully this will set you up for success.

Just remember the money, the money, the money.

On that front, one of the best pieces of advice I was ever given on this was from a senior art director, Grahame Dingle, who told me the most important person in the agency to befriend is the Finance Director, not the Executive Creative Director.

He said on your first day at the agency make sure to introduce yourself to the Finance Director and invite them to lunch. Then make sure you extend an invitation to them to attend all of the creative department events, from Friday lunch (it was the eighties) to the award night and the photographer Christmas party.

Why? Because most people do not make the effort, so when you do it makes a difference. After all, they are the one that ultimately approved all of your expenses and when it is time to leave the agency, especially if not by choice, they will look after you on the way out the door. Worked every time and even helped fund my Plan B.

So good luck with your brilliant advertising career.

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The potential impact of an agency search on a marketer’s business can perhaps be best measured by multiplying your annual agency budget by 10 years – an anticipation of the length of the agency relationship. So a client with a $20 million budget, for example, could potentially be facing a $200+ million decision – not something anyone should want to take lightly.

Since the ICA launched its Pitch Watchdog two years ago, the association has questioned pitch processes from companies including Canada Post, TD Bank, the TTC, and YMCA. Earlier this year, the ICA came up with the idea to “send one of five anonymous, hand-written cards directly to the contacts”of an offending brand provided by an agency.

Irrespective of the likely breach in a non-disclosure signed by the participating agency, the ICA says the goal of these anonymous missives is to provide a “humorous yet pointed push” for clients to get the ICA’s free QBS toolkit. The toolkit is the ICA’s best practice agency search guide, and includes a binary outcome diagram to either “amend process” or “name and shame in public media.”

Personally, I’m not sure anyone would find anything humorous about being on the receiving end of an anonymous calling-card (handwritten or otherwise). And issuing a “search guide” in “an attempt to provide insight into the ‘why’ and the ‘how’ of abandoning the price-based RFP” just isn’t going to help anyone.

Advertising’s problem with RFPs

The reality is there are (unfortunately) advertiser requests for pitches out there that are badly conceived and executed, and can place excessive demands on agencies seeking to grow their businesses.

Whether it’s because they’re too cumbersome (because they ask for too much or unnecessary information), too complex, don’t provide sufficient guidance or make unreasonable asks – some clients get it wrong. And yes, sometimes badly.

While the origins of poorly run pitches may go back years, things began to take a noticeable turn for the worse during the financial crisis in 2007. Marketers found themselves under increasing pressure to cut costs while bettering performance with smaller budgets, and procurement teams were brought in to run pitch processes – or at least provide an extra layer of oversight.

Because procurement teams are often less familiar with service-based sourcing and/or not synced with their own marketing team counterparts, procurement driven RFPs can include complex asks and are evaluated based on an over-reliance on financial metrics. Outcomes can then be skewed in favour of price rather than value and otherwise perfectly suited agencies become eliminated too early in the RFP process for the wrong reasons.

But just because there are rogue RFPs that surface with unwieldy requests, doesn’t mean we should throw the whole process out as the ICA is stating: “when it comes to agency selection, of any kind, it’s not working…”

I resent the assertion that “agency selection, of any kind” (which is, by default, the hundreds of millions of dollars in searches we’ve done for some of Canada’s best known brands over the last decade) isn’t working. For the record, pitches we run never ask for prices up front and our evaluation methodology is always a discussion around who and what constitutes best value – not lowest price.

Sure, the ICA’s toolkit makes good points on low-cost processes, clear and obvious selection criteria, transparency and limiting the number of pages to force a balance between brevity and clarity. And it talks a lot about collaborative client-agency relationships too. But its watchdog diagram that concludes the guide, undermines its own message by threatening to name and shame in the public media as a recourse to those who don’t agree.

My view is soliciting media headlines and publicly naming and shaming clients does a disservice to both clients and agencies.

Industry bodies and consulting firms that hold unique and privileged positions of being able to view the market from the sidelines, surely have a duty to demonstrate leadership and help clients who may not be experts in agency search management. The Association of Canadian Advertisers offers a step-by-step best practice guide to their members on Searching for a Marketing Communications Partner. The Canadian Marketing Association has also developed best practices and guidance for RFPs, which it plans to release soon.

And for marketers or procurement teams tasked with managing an upcoming search, there are also specialist consultants who can provide objective advice and guide teams through their search processes – no matter if your extrapolated budget works out to be millions or billions.

In my experience, agencies are incredibly savvy about being their own watchdogs and doing what’s best for their teams and their businesses. So when it comes to the ICA’s watchdog in the background… stick it back in its kennel.

This article first appeared in Strategy May 21, 2019.