Ogilvy NA Appoints Discipline Specific MDs

Interesting note in the press from the US about Ogilvy North America. 

A lot of bigger agencies have been experimenting with mixing up teams, de-accentuating or eliminating P&Ls, and cross-training up people so they can deliver integrated solutions.

The question is does it work?  At Ogilvy in NY the decision has been made to have separate MDs running DM and Advertising — which means perhaps not.

“We were trying to get people not to worry about a P&L and to think in a more holistic way about [client] solutions,” said John Seifert, North American chairman of The Ogilvy Group. “The effect that it had — which we discovered pretty quickly — is that it started to create a kind of grayness to what each discipline stood for.”

And, it must be assumed, that must have impacted on how the teams reacted to client requests and the quality of the work.  Otherwise the agency — which is one of the most mature and best run of the big established agencies — wouldn’t change course.

They’ll run their divisions, but then they’ll have an accountability on her [Carla Hendra’s] leadership team to make the whole greater than the sum of the parts.”

“There should be a common culture and philosophy of our promise to clients,” said Seifert. “But … we don’t want that to be lost in a mushed-up ‘we’re all one’ kind of model.”

Interesting to see — and equally interesting that DM and Advertising are seen as requiring separate management, but Digital is not.  Like a lot of established agencies, the management of DM, Advertising, Media, Heathcare Marketing, and PR have proven their case that their disciplines have a complexity and special skills that require nurturing and dedicated management. 

But poor OgilvyInteractive – despite being the oldest interactive agency brands and having a good case to celebrate turning 25 this year — languishes in integration without dedicated management. 

Be interesting to see how that works out as the year progresses.

 

Ogilvy Team: Separate but Equal

A restructuring in New York results in two new managing directors

March 8, 2009

-By Andrew McMains

NEW YORK When Ogilvy & Mather named separate managing directors for advertising and direct marketing at its New York headquarters last week, it was a tacit acknowledgment that having co-leaders across all disciplines bred confusion among staffers and a lack of accountability among bosses.

“We were trying to get people not to worry about a P&L and to think in a more holistic way about [client] solutions,” said John Seifert, North American chairman of The Ogilvy Group. “The effect that it had — which we discovered pretty quickly — is that it started to create a kind of grayness to what each discipline stood for.”

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Proximity Gets a US Office – and it's digital

After all of these years the “worldwide network” of Proximity will have a US office.  It will also give Proximity’s digital team a major boast which I’m sure the teams in London and elsewhere will look forward to as they try to develop more digital work in the DM-centric offices.

So two questions to watch —

1) will Atmosphere add DM skills to become more like the original Digitas (Simon Hall’s original vision)?

2) will Proximity follow Atmosphere’s approach of building digital around display advertising not websites and applications?

Being focused on display advertising as Atmosphere is makes it a lot easier to integrate with BBDO’s traditional approach and creative structure, but makes it harder to be do advanced digital marketing — the transformational kind that requires good consulting, technical and deep creative skills.

Then again this may be smart — just as the management consultancies have said ad agencies shouldn’t bother to try to get a seat next to the CEO, perhaps they shouldn’t try to do complex digital work like R/GA either. 

There is plenty of work out there doing advertising and campaigns.

Thursday, Feb 19

Breaking: Atmosphere BBDO To Be Absorbed by Proximity Worldwide

AgencySpy has learned that Atmosphere BBDO will be absorbed by Proximity Worldwide. Roy Elvove, EVP director of corporate communications confirmed the news moments ago.

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R/GA Agency of the Year – Adweek

R/GA really may well be setting itself out as the agency for the new millenium.  They do a lot of things differently — a lot smart, some less obvious.

Take the smart set.  Here is a set of quotes from this AdWeek article that are really sharp in my book and when you review them — and other notes about the agency — you see a theme:  the importance of technology, the idea that you create applications that are fixed rather then campaign-based, and that brands must commit to be successful.

R/GA has been the fastest growing agency since the 90s, has done amazing work and retains clients with big relationships.  That is by definition success in our industry.


“There’s a difference between us and someone like Crispin Porter + Bogusky. We’ve taken the direction of building brand platforms rather than viral stunts or one-off things.” [Robert Greenberg]

The key, as Greenberg has long and frequently advocated, is technology, which enables forward-thinking companies to build systems that attract and retain customers while weaving marketing and product together.  “We’re looking at customer behavior and seeing how to create something bigger than a TV spot or print ad,” says Greenberg, an architecture buff.

With a relationship dating to 2001 — a lifetime in the interactive world — Nike and R/GA are deeply enmeshed. “We have people on the ground at Nike,” says Nick Law, chief creative officer for North America at R/GA. “We have deep technical relationships with them.”

One of the crucial aspects of R/GA’s work in 2008 was to make real the promise of blurring the physical and digital worlds. This is an old quest for the digital industry and has, for the most part, come up empty over the years. Not so anymore.

“Software is a medium,” says John Mayo-Smith, R/GA chief technology officer. “Having people who understand software and a high-quality user experience is really important.”

Greenberg saw something different: He saw technology forming a new kind of creativity that relied less on the metaphors of talking animals in TV spots and more on brands connecting people. If the “traditional” notion of digital creativity is the hot viral video, Greenberg counters with an application that uses data in a new way to help people live better.

The key to apps: tech chops.

“They understand the Web, engagement on the Web and e-commerce,” says Michael Mendenhall, CMO of HP. “But they also understand advanced TV, mobile and all the other touch points that are part of the digital ecosystem.”

Entry to the executive suite also has given Greenberg an opportunity to sell his religion: that agencies must have technology at the core to help clients navigate the new world of digital media. While traditional shops might thrive in creating the hot viral video of the day, he preaches, they will fall short when it comes to building sustainable brand platforms and useful applications that blur product and marketing. That even applies to a shop like Crispin. When it comes to the core of Nike+, “they couldn’t even have the conversation,” Greenberg says.

A key area for the model Greenberg envisions is production, a discipline in which R/GA began its existence back in 1977. While most agencies rely on outside production, R/GA has kept its in-house. In 2008, revenue from the 30-person production facility grew by more than 300 percent compared to 2007. The digital studio shot over 250 video projects during the year, working for R/GA clients and other agencies and firms.

R/GA: Digital AOY 2008

The IPG shop’s mantra of utility over gimmickry proves its relevance as the stakes rise

Feb 16, 2009

-By Brian Morrissey

Stepping into R/GA’s New York headquarters, a visitor notices, amid
the general bustle of a busy shop, the beautiful, sometimes
haunting images on the walls.


They are pieces from Bob Greenberg’s personal collection of
“outsider art,” more

Linx goes to … TMW. BBH Digital?

This is interesting.  It seems like it was only yesterday that we were all talking about BBH having won Lynx’ digital business.  It was one of the big events like Glue almost winning 3’s advertising.  And it made digital veterans like Ian Tate question on the difference between digital and advertising clients.

Their first campaign launch, the Lynx Effect, was called an “agenda setting event” by Clare Beale herself.  She called out the planning and striking design in an editorial, and in her column in the Independent made it sound as if the growth of the digital agency was done.

21 January 2008, The Independent

So the new site – www.lynxeffect.com
– is crammed with clever chat-up tools, such as a “fit girl finder” that you can download on to your mobile, and advice like, “Alcohol and chocolate make for a lady-wowing combination”, so click for cocoa cocktail recipes. And yes, there are plenty of sexy pics and the whole thing is beautifully crisp and user-friendly.

But sod what the punters might think of it. The big question in adland is: “Can the non-specialist agencies do digital?” On the basis of BBH’s Lynx work, the answer’s a big, agenda-setting “yes”.

Claire Beale is editor of Campaign

I’m not sure at the time the digital specialists out there were as impressed by the site.  Other work like BBH’s launch of an Audi site was pretty heavily critiqued.  With a brand like Lynx it is usually easy to make great viral, and interactive campaign sites like Dare’s Feather show it.  This site, aside from a great early use of video, is interactive, has send to a friend features and is original.

Brands doing their own video sharing sites like the Linx Effect are dismal and really were only proposed because teams new to digital could say “a YouTube for <insert brand here>.”  Or maybe it is the opportunity for junior ad agency art directors to try out their directing skills for the seeding videos.  Unfortunately they rarely catch on with the public as Coke found out in a big way.  As did Hellmann’s.  And countless others.

Of course the bigger question is what happened to BBH’s digital team?  Was the big digital build out just a pr exercise?  There was a very tight campaign with the reporting on hires like Michelle Stanhope from Glue. And the Linx win just afterwards.  Had BBH truly turned the from its break up with Dare?  In that case a group of digital experts decided they couldn’t work with the big famous ad agency — even despite BBH owning 37% and having John Bartle himself as non-executive chairman.

I think the answer is that “learning digital” and integration is harder then people expect.  This article from the Times gives a nice view — and has a great quote that explains it.

Consider BBH’s Executive Creative Director’s quote here:

The Times – 13 May 2007

John O’Keeffe, executive creative director at BBH, is sceptical that there is anything unique about digital marketing skills. “There is a very, very simple truth to all this,” said O’Keeffe. “Nothing is more important than the idea. The people who espouse the view that [digital specialists] have some kind of technological advantage are diminishing in number. It’s just not the case.”

He added: “The technology is functionally very simple. It’s not difficult to find people who can press the right buttons. What’s difficult, and what’s always been difficult, is getting people who can have a great creative idea.”

I can’t say I know John O’Keeffe but I think I’ve met a number of people like him.  Ideas are very important — but unlike a print ad, in the digital world the idea is only the beginning.  And in the same Times article, the journalist hits the real point.  The client’s point of view.

Unilever’s Alan Rutherford sounds less certain that the technical skills are easily acquired. He said: “We’ve given BBH the Lynx account to see if
they can get up to speed on digital.”

Unilever awards Lynx digital account to TMW

by Fiona Ramsay,

marketingmagazine.co.uk

03-Feb-09, 11:45

LONDON
– Unilever has appointed digital and direct agency TMW to work on the
digital marketing account for the Lynx brand following a pitch.

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Digital Agency Brands Closing? Downturn or politics?

Beyond Interactionhttp://www.olayan.com/pub/wpp_logo_image01.jpg

Another digital agency is “integrated.”

Not uncommon in a downturn. By integrating agency units holding companies save on management costs (one MD, one CD), are able to maintain team size (two smaller teams become one bigger one) and consolidate overheads across more revenue.

But do we think Beyond is closing because none of Mediacom’s clients are asking for digital services?  Not likely.

This is integration because of the political need and justified by the feeling clients want a single integrated partner, as is commonly reported in the industry press.   The strategy makes sense.  Taking digital-trained teams and distributing them amongst the traditionally-trained ones should end up with both being stronger.  Clients can call on a single account director and get all of their questions answered and needs met.  Unfortunately that isn’t what generally happens.

The question to watch will be what happens to Sloan Broderick and the digital leadership team.  More often then not when the smaller team (the digital one) is assimilated into the bigger shop, the digital team doesn’t end up in the leadership posts.  Or only one or two become part of a management team of 7 to 10 — which doesn’t allow them to make policy changes and quickly leaves the digital leaders disillusioned at the thought of trying to fight to change the course of the supertanker.  Consider Colleen DeCourcy‘s moves through JWT (now focused primarily on RIOT, a digital-led agency), Don Scales leaving Agency.com when it was “aligned” with TBWA (now running iCrossing) and Eric Wheeler at Ogilvy (now running 33across, a digital business).

For the team trying to deliver the work the situation is even worse.  Being integrated often means being surrounded by people that don’t have the same passion you do for digital marketing — and think the term geek has negative not positive connotations.  And this in an industry that changes so quickly you can’t keep up alone.  You need your digital colleagues.

It also frequently means you are reporting to someone that doesn’t understand the issues of trafficking a complex rich media campaign and can’t field an issue that is escalated.

The classic case is the manager saying, “I don’t see what you are so concerned the client wants 3 extra variants on the creative.” When the digital account person knows that with 5 markets and 5 typical online ad layouts plus 5 or so resizes for each, the boss has just agreed to 375 new ad units — all that need to be optimised, tagged, uploaded and trafficked…for tomorrow.

Or perhaps a more fundemental issue like proposing the need for a media plan template change to accommodte behavioural targeting, in-campaign optimisation or templated creative.  On the creative agency side consider our isolated account manager being caught by the big agency creative director (with all the ego this position requires) trying to break up the creative black box asking the solutions be developed collaboratively rather then in isolation by the art director-copy writer  teams.

In the Revolution article linked to above, Kevin Murphy, joint-MD of Zed Media, comments that

It’s clear that many traditional agencies still have some catching up to
do, but they’re doing it fast. Digital specialists will no doubt be
looking at selling up while they still have some real value, or
concentrate on forming close strategic partnerships with larger agency
networks.

I’ve got a slightly different opinion.  Being part of an integrated group has huge benefits, but being an “integrated” team is a disaster.  And I think the next year will prove it when I update the headcount figures.

WPP Moves Beyond, Beyond: Digital Brand Will Cease To Interact

by Joe Mandese1 hour ago

As part of a reorganization that will more seamlessly integrate its traditional and digital media services brands, WPP’s MediaCom Worldwide unit next month will drop its Beyond Interaction brand, and will consolidate all its digital operations under the MediaCom Interaction name, Online Media Daily has learned. The move marks an end to one of Madison Avenue’s seminal digital media brands, and one which WPP acquired in 2005 as part of its acquisition of then Beyond parent Grey Advertising.

http://www.mediapost.com/publications/?fa=Articles.san&s=98769&Nid=51393&p=929055

 

R/GA – AgencySpy hits a key point

Matt Van Hoven over at AgencySpy gets to see a lot of agencies and definitely spends a lot of time thinking about them and writing about them.  As much as you can’t say it is high-brow journalism, it is entertaining.  And can be insightful.

Take this comment from his recent visit to R/GA, one of the most successful agencies (of any kind) in the last 5 years.

mediabistro.com: AgencySpy
“Here’s how it’s not a traditional shop. Technology plays a greater role here than we realized, typified by “technical creatives” who sit in the same space as the writers, artists and whatnot. Ideas come from everywhere, including the people who know how gadgets work. No writer/art director silos here.”

The key point here is that producing strong digital work requires more the smart creatives thinking about good digital ideas — it reaquires a structural change in how traditional agencies operate and a much stronger appreciation for the technical staff they currently keep in the basement next to the print production team.

Who's Been Winning?

There has been lot’s of discussion in the creative agency world about the impact of digital marketing and how agencies should respond.  It appears every agency from advertising networks like BBH to traditional DM shops like OgilvyOne to creative hotshops have put “Digital at the Heart of the Agency.”

Only this past May Alastair Reid reported in Campaign a reasonably balanced article about the increase in digital awards being won by traditional agencies, and brought out the classic Goodby turnaround in the US a few years ago.

But whose really been winning?

Looking at the 2008 NMA Top 100 that was just released last week, we see that Digital agencies have seen another year of solid growth — averaging 20% across the list.  In his introduction Michael Nutley also makes a balanced argument for the state of the industry.

But maybe we are being too analytical — if one uses the simple measure of headcount over the last 5 years, we can see where the growth has been and inferr that this represents shifts in revenue.

The top digital agencies have had an amazing run since 2003.  I take 2003 because it is 5 years ago and it was solidly after the collapse in 2001-2.  From ad hoc conversations I think that agencies like AKQA have gone from say 120 in 2003 to over 350 today — that is 191% growth in London alone.  Dare was probably about 60 people in 2003, and now reports having 174.

I’ll need to do more digging to get good numbers but here is a basic table I’ve pulled together from industry articles and league tables and rough memory.  It will be interesting to check in another year’s time.

Agency 2003 2008

Digital Specialists

AKQA London
Dare London
Agency.com
LBI
iris Digital
120
40
30
350 (NMA)
174 (NMA)
115 (NMA)
352 (NMA)
33 (NMA)

Integrated DM/Digital

Proximity London
OgilvyOne
DraftFCB
220
210
282 (ipa)
270
185 (ipa)

Advertising
Grey
JWT
McCann
BBH
AMV BBDO
200 (ipa)
246 (ipa)
245 (ipa)
450 (ipa)
400 (ipa)

Independents

iris
Mother
Crispin
450 (ipa)
125 (ipa)

The End is Near (again)

Shops Stand to Lose in Digital Revolution

November 14, 2007 By Brian Morrissey

Agencies have the most to lose in the new digital order, even more than broadcasters, per industry leaders surveyed by Accenture.

NEW YORK Changing consumer habits, driven by the shift from analog to digital media, are revolutionizing the ad industry. But that could spell bad news for agencies, according to a new study by Accenture.According to 70 industry leaders surveyed by Accenture, agencies have the most to lose in the new order, even more than broadcasters. When asked who would fare worst in the transition to digital advertising, 43 percent said agencies, compared to 33 percent who answered broadcasters. Cable operators were third with 10 percent. No respondents chose search companies or digital ad specialists. IBM

The end of advertising as we know it

IBM Institute for Business Value study

Imagine an advertising world where… spending on interactive, one-to-one advertising formats surpasses traditional, one-to-many advertising vehicles, and a significant share of ad space is sold through auctions and exchanges. Advertisers know who viewed and acted on an ad, and pay based on real impact rather than estimated “impressions.” Consumers self-select which ads they watch and share preferred ads with peers. User-generated advertising is as prevalent (and appealing) as agency-created spots.Based on IBM global surveys of more than 2,400 consumers and 80 advertising experts, we see four change drivers shifting control within the industry.

Chaos 1.0

This is a piece I wrote for the IAB Engage Conference Handbook:

The Future of Marketing?

End is Near

“The advertising industry is passing through one of the most disorienting periods in its history … More people are rejecting traditional sales messages, presenting the ad industry with big challenges. ”
Economist, June 2004

“To find something comparable, you have to go back 500 years to the printing press, the birth of mass media …”
Rupert Murdoch, quoted in Wired, July 2006

It is an interesting time in the marketing industry.

Advertising agency executives, faced with the fast adoption of personal video recorders and shift of magazine content online, are convinced the business will cease to exist in as soon as five years. Or five minutes if you listen to Bob Garfield.

Direct Marketing agency executives are watching B2B communications shift aggressively to email and are questioning whether the traditional direct mail piece will be a relevant tool for generating leads or even delivering offers before too long.

PR agencies see that the tradition that all corporate communications is channelled through the corporate communications department to specific high circulation publishers is loosing relevance. Internal experts are expected to publish directly and the required response time for crisis management is minutes not days.

Finally, Media agencies are being presented viable online auction systems from SpotRunner, eBay and Google that could make the “buying clout” argument irrelevant. What’s more, they know the traditional media plan could quickly disappear as more channels are served and managed like search media.

In the face of all of this, amazingly the Digital Agencies also feel their business is under threat. As all briefs become “interactive briefs,” they are being stretched to compete with all agencies from all disciplines. They of all people recognise digital marketing encompasses a broad tool set and can be part of every campaign. As traditional agencies push for interactive work, they are looking to offer a broader solution including advertising or DM.

The piece that is critical is of course our clients. Marketing departments have their own pressures as product development, supply chains, communications and sales are impacted by technology. The last thing they need is their agencies bickering with each other over who does what, why and how.

As we go through this period of transformation, clients need to know they have a partner that can bring the people with the right skills to the table and know that there is clear programme management of their 360 campaigns. They need to know the core of their business will be delivered safely, but also know that their partner is willing to be adventurous. They know they need to be innovative, but briefing multiple agencies and managing the integration of the resulting work is more then a small challenge.

At OgilvyInteractive, our teams sit and work with each of the discipline organisation to be able to bring digital expertise together with the years of experience in advertising, direct marketing, healthcare marketing, sales activation or PR. As a community of digital professionals, we work with our colleagues in bespoke teams to meet our clients’ needs and work together to stay on top of the industry that is in constant change.

It may be a confusing time to be in marketing, but it is also a great time because the disciplines that were in silos in the past are now working together and clients are willing to test and measure new ideas. The big digital toolbox is being used to amplify great work across the disciplines which should be the result when you are doing real integrated 360 degree campaigns.