Is the ad industry about to sink without trace?

Will WPP collapse like a stack of cards? Will the industry fall and rise like a phoenix? Or will it muddle through? Has the industry lost its values and value to clients in the pursuit of shareholder value? These were just some of the discussions I’ve had over three amazing days spent on the Aurora boat at the Marketing Forum.

On a more upbeat note I had a great three days speaking on ‘ethical marketing & the new consumer’ and networking. The event is certainly the best one of the year for meeting all sides of our industry. It’s always good to discuss hot issues with people that have different view points. And enjoy great food and a few beers ‘til the early hours of the morning – it’s also one of the year’s best parties. It was a great opportunity to be able to hear the opinions of clients, agencies and business experts like Robert Shaw and Andrew Marsden.

One subject that came up constantly was the effect of the credit crunch on the industry. There’s few who cannot be worried, and I’m sure Martin Sorrell is sipping diet Coke rather than champagne (unlike the fat cats from the banks who were in Monte Carlo last week). Sorrell is a pragmatic realist when it comes to making agencies make money. Few cannot respect him and his ability to build a very successful media group but he’s an accountant not a visionary and could learn a lot from understanding the value of creativity as WPP goes forward. I’d love to spend a lunchtime with Sorrell and change his thinking.

The big issue is values, agencies were traditionally built on values not value to shareholders. And with the current economic climate we, the masses, are all paying the price for an economy that is driven the few. Even the Sun has fuelled anti-capitalism attitudes towards the City. Revolution seems to be in the air. One way or another the ad industry could be in for one of the most dramatic changes since the 60s.

The industry – both clients and agencies – have moved from longevity to short term thinking. The average clients stays in his job about 2 years, agency staff aren’t much better. When once we thought in campaigns over years we now think in weeks. Is it any wonder many big brands have lost their way? The industry has moved its focus from great work that worked, to shareholder value. It has been on a path of cost cutting and in the process it’s cut planning, creative and other value dominated areas.

“Cutting costs is not the same as making money” was my father’s favourite saying. Replacing talent with time focused low level staff is short sighted. “Bubble wrap’ is the term being used by some clients to describe many agencies – “20% substance, 80% air”. One client put it bluntly, “why would I buy an agency just made up of suits? I want to pay for talent – creativity and thinking - and that’s coming harder to find.” Other clients were nodding in agreement.

No disrespect to account handlers, but clients don’t think you are strategic thinkers and therefore no replacement for planners. I‘ve only met a few who could be both planner and account handling. And the idea that account handler led agencies can buy in freelance talent is pointless. So can clients. On a business level, it was felt that agencies are not aligned with client’s business needs. Robert Shaw in his lecture commented that agencies and clients need to stop thinking of budget as pocket money. Clients and agencies need to work closer together as business partners rather than supplier and master. Both need to adopt more professionalism and financial accountability.

So what will the future of the ad industry look like? This is yet to be decided, but change is in the air, so if you are not planning a new model you may be a looser rather than a winner. We have gone from an agricultural economy to a manufacturing economy and beyond - now more people work in Indian restaurants than car and boat manufacturing. We are now in the Creative Economy where it’s intellectual capital that is up for sale. It’s called the Creative Economy by governments and economists for a reason. By contrast, some developing nations are stuck in a Service Economy, when your people is your greatest resource.

So why are agencies not getting this? They need to invest in brain power, yet as an industry we employ more account handlers than planners and creatives. It seems the ad industry wants to work in the service economy. “Agencies are like restaurants,” was the thought of one great adman, Roy Williams. People go for great food, for that you need a great chef (creatives). They expect excellent service (account handling). Which one do they pay more for? Clients also need to review their position. "It takes good clients to make a good advertising agency. Regardless of how much talent an ad agency may have, it is ineffective without good products and services to advertise."
- Morris Hite Personally I think those agencies who focus on value – creativity & strategy – will become the new winners.

Greater efficiency, better understanding of clients (because clients can talk to the thinkers) and more effectiveness. Clients will see greater return for their budget because more will be spent on talent. It’s common sense. There will also be the development of a new breed of logistic based agencies that just deal with execution to support the previous types. And the role of account handlers will move to more project management – so goodbye to lots of meetings, long Powerpoints and waffle. Of course many will disagree but that’s the beauty of predictions – everyone can have an opinion but only time will tell. On a more cheerful note, a few days on the Aurora generated some good gossip. I met a couple of great journalists from both Marketing Week and Marketing, but alas I promised not to write any stories about them in my blog, in exchange for none about me! That was one great night!

Excuse me why I just slip into my organic fair trade fashion wear.

This week all eyes are on ethical fashion and organic everything. And despite a credit crunch we could all be getting greener as a consequence according to Alice Thomson of the Times. Also this week I’m working late hours writing a book for a major publisher on Ethical Marketing & the New Consumer (due to be published in Feb 09).

If anyone wishes to contribute case studies, research data or some really great stories please contact me via this blog or email me at book site - chris@ethicalmarketing.plus.com.

This week is organic fortnight and the Soil Association are running events and activities all over the UK with the Scottish Organic Food Festival on September 20-21st. While the supermarkets offer us discounts and incentives to buy greener greens a recent survey suggest that organics is leveling off – the credit crunching is crunching organics.

A piece in the Times by Alice Thomson ‘Suddenly being green isn’t green anymore’ reflects on how ironically the economic downturn is making us all greener – we drive less, waste less energy, food and therefore packaging. She thinks the salads days are over (quoting the MORI and Organic Monitor polls). She had an amusing pop at Julie Burchill, commenting “she thinks all environmentalists are po-faced, unsexy, public school alumni who drivel on about the end of the world because they don't want the working classes to have any fun, go on foreign holidays or buy cheap clothes.” It’s also London Fashion Week – exciting for some, amusing for others.

However, it's good to see that many ethical fashion brands are getting noticed. Can I make a plea that people stop equating hemp to sack cloth. Few people seem to be aware that hemp t-shirts are softer then cotton and use half as much water to produce, unfortunately they cost twice as much. The London Fashion Week has seen a growing number of ethical fashion brands, designers and events year on year encourage by groups like estethica. Ironically, the credit crunch could also encourage people to look at clothes differently.

Primark (and other cheap fashion shops) are loving the credit crunch and stand to dominate the high street with there 'fast fashion' approach, providing credit crunched consumers with clothes that are so disposable it’s not work washing and as a consequence causing a landfill problem. And the government is worried about direct mail (only 2% of household waste)! But while some buy cheap tat, others actually look for longer term value – clothes that last – and most ethical fashion is well made. Or they learn to recycle or remake – a popular trend in Australia.

Ethical fashion – or ‘eco-sustainable fashion as it’s now called - has grown up a lot over the last few years and designs have got hotter. Adili sponsored the Make Your Mark In Fashion event to find young designers. The winner was a girl who’d been working at Junky Styling (a winner at this years’ Observer Ethical Awards). Junky also sponsor a young designers event. Even though the ridiculous prices to get on the cartwalks may be a barrier to small ethical fashion producers it could also keep it one step away from the pompous and stupid end of the fashion market.

Personally I’d rather see an Edinburgh Fringe style of event, it feels more honest. In a dog eat dog world, RSPCA has dumped Crufts because they are not happy about the ethics of some dog breeders and concerns over the high rate of inherited genetic disease among pedigree dogs. Good on them. Now there’s pressure on the BBC to pull out too, who started the issue with a programme they made called Pedigree Dogs Exposed. The discussion between the RSPCA and a representative from the Kennel Club on the radio got very heated – she lost the plot and did themselves no favors. Meoow

Pervert Penguins save the planet

There are some amazing stories around and some that just make you laugh. None more than the case of the two environmental campaigners who dressed up as penguins and were seen as being potential paedophiles.

If you thought they were nuts, meet Telford Council! This story comes straight out of the ‘Barmy Britain’ category. Telford & Wrekin Council have managed to reinforce the idea that people who become councillors are probably the last people on the earth who should be councillors. And certainly not let near children! They obviously have little else to do than panic.

 Having been reading too many stories about Gary Glitter in the News of the World, they fear that Telford’s children are being preyed upon by dirty old men, so they have started targeting any single men in the local parks. They claim they are trying to prevent paedophiles and perverts preying on kids and womenn. No doubt they’ll also evict Arabs and muslims (who may be terrorists), anyone with a hood (could be a mugger) or any large red people with horns (could be Hellboy).

So when Rachel Whittaker and her friend (note, not a man) were spotted dressed in penguin suits giving out leaflets to educate kids about climate change, a pair of fascist park keepers moved in and moved them on. Not surprisingly, the penguins got the last laugh with lots of publicity, meanwhile Telford got egg on their face.

For great fun in the ethical arena pop The Gruen Transfer into YouTube and enjoy. You find some great ads promoting child labour and the benefits of global warming. Yes, that’s right. The former ads points out that kids in the third world earn money, learn about responsibility and the value of work young. Stay health and learn skills. By contrast, kids in the West are spoilt, get fat, watch TV all day and corrupt their minds with violent video games. They have a point.

Global warming is helping people who live on the streets. So every time you drive you car you can feel good that you’re helping people not freeze in winter. There are a few of many very funny ads from this Australian TV programme The Gruen Transfer that likes to take the mick out of advertising, the world and especially New Zealand – “lets invade New Zealand” is the cry of one ad. They especially like to tackle subjects that others wouldn’t dare. And finally, take a trip to the world of SPAM “it’s a big world out there, and it’s full of meat.” What a great slogan It may not be organic or vegetarian, but the US site is kitsch to the point of art.

There’s even a museum “sure beats an art museum and it’s free”. Or check out the merchandise – SPAM costumes, boxer shirts, ties and everything you could want for Christmas presents. You can even join their fan club. We once set SPAM as a brief for a D&AD workshop – after all, who better to sell it to than students – they’ll eat anything. The best lines were “All meat no greens” and “If you want greens, leave it out on a plate for a week.”. Nothing like truth in advertising.

BBC launches Mr Riley’s meaty & sweety pie range

Those watching Mischief on BBC last night (Britain’s Really Disgusting Foods) hopefully weren’t eating their evening meal in front of the TV. Mr Riley’s Pies may well come packaged to look tasty but when you discover what’s in them, even given the marketing spin, they are not so appetizing. The show that featured Steve Phillips (Spring Research), Brooke Dalton-Brewer (Spinnaker) and myself was actually great fun to make.

There’s nothing like a light hearted look at the darker side of marketing. Though I’m sure many packaging agencies are livid that advertising people exposing some of their devious techniques. Give it a personal identity, old fashion packaging for a traditional look, farm images for credibility and the master stroke – dolphin friendly. Northern comedian and anarchist, Alex Riley may not be to everyone’s taste (just like his dad’s pies – yes that is his dad on the packaging) but he makes it lot more interesting that those old stuffy BBC presenters who take it all too seriously.

Dressing up in a wet suit and filling it with water certainly makes the point about how much water is added to chicken! The programme format was simple - Alex goes in search of the most disgusting thing that can be legally sold as food. He discovers manufacturers have ingenious ways of transforming poor ingredients into something that looks and tastes like good food. Corn starch (wallpaper paste) is one common ingredient. He unearths hidden horrors, from substitute cheese to beef connective tissue and many other horrors. And that’s the legal stuff, imagine what’s not legal that gets sold? The programme set out to expose just how crap some food we’re sold can be.

What actually goes into those pies is disgusting though we all ate them and strangely they actually tasted ok. I had some in my office for weeks and as a sign of just how little real food was in them it took that long for them to go moldy. It was inevitable that the programme would set up big names and Brooker certainly got a pasting. Though I do think they were unfair to one of the big agencies (no names as I’m sure they’d prefer no further publicity).

Asda, by contrast, I thought came our really well. Thankfully, we were in on the humour rather than the victim and I do think that humour is a great way to make a point. However, there is a serious ethical and moral point – as an industry how do we cope with selling products we know are crap? Not so bad when everyone knows it - no one is trying to pretend KFC uses the finest quality freedom farm chickens. We buy it knowing exactly what it is so at least there’s an honesty about it.

But some of those pies and pasties sold as authentic quality foods aren’t. Sweets with chemicals in. Foods packed full of water or other substances. Kids snacks with e numbers? Apparently, Kellogg’s artificial Maple Syrup had the greatest number of e numbers in. Where do we draw the line? When is it acceptable and when isn’t it? Should we have a moral code in the ad business? Some agencies refuse to work on cigarette accounts (AMV), others on oil companies. With the great debate about marketing to kids, is there an ad agency who is prepared to say no to marketing crap snack food? When we did a research group with kids we asked them who are the bad brands - Coke, Pepsi, McDonalds, Burger King, petrol companies and a few others were mentioned.

Although it’s easy to take pot shots at these ethically demonised brands (I could write a lot about the good work that McDonalds, Coke and Pepsi are doing) there are many worse ones that look like angels, selling us hidden horrors. Why are chocolate, biscuit and crisp manufacturers not demonised? The programme, like advertising will be tomorrow’s chip paper - no one questions how crap fish and chips are do they? It’ll have its 15 minutes of fame around the water cooler and then a few hours later we’ll all be eating Cornish pasties again and diving into a kebab after the pub.

It’s ironic that with the credit crunch sales of McDonalds has gone up – so much for the health conscious consumer. But more frightening than the revelation about ingredients (or the fact there’s a glass full of fat in every kebab) is the ad they made themselves. It’s a lesson in why you should never do it yourself and should always get experts to write your ads!!

There’s another episode that features a few adland faces in too – look out for the one on data – Your Identity For Sale (BBC Three Sept 11th). Rebecca Wilcox, who’s a lot more attractive than Alex Riley, clocks up over 1500 ads she’s exposed to in one day and reveals the abuse of data and a few revealing facts about Facebook.