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Decideware’s Agency Management  Big 7 - September 2017

Below are the September articles of interest from key trade publications, with excerpts highlighting key take-aways. This month's selection includes articles on the secret to great creative, what's behind the trouble on Madison Avenue, as well as tips for improving agency compensation practices and transparency.  We hope that you find this month's selections informative and valuable.

1.The secret to great creative is...account people?

You can hire the best creative talent, but without a strong partnership with the account team, the venture won't succeed, says JWT Atlanta's CCO.

One of the most important secrets to delivering great creative to the world is great account people.

2. What's Behind The Trouble On Madison Avenue

The waning days of summer signaled a humbling moment for, arguably, the most successful man in advertising history, Sir Martin Sorrell. Sorrell, who built WPP into the world’s biggest advertising group, saw his company’s stocks plunge 12% in one day, as like-for-like net sales growth, the key top-line growth measure for ad agencies, fell into the red in the second quarter. The crumbling dragged down the entire sector, with Omnicom and Interpublic stocks tumbling 5-7%.

3. More Than Trouble on Madison Avenue

After reading Avi Dan’s piece What’s Behind The Trouble On Madison Avenue, Chris Ross felt compelled to do more than just leave an epic comment. Avi’s post is well worth the read and makes some vital points about significant challenges in the agency world. Every agency should be paying attention to transparency, coordination, fee structures and engagement models. 

Despite the genuine issues, things are certainly not all doom and gloom for agencies, especially those that are willing to take a fresh look at how and where they provide value.

4. Tips for Improving Agency Compensation Practices and Transparency

The ANA’s latest Trends in Agency Compensation report states that the 2016 Media Transparency Initiative, which revealed pervasive non-transparent business practices in the U.S. media ad-buying ecosystem, had an impact on compensation reviews and negotiations. Marketers who were aware of the transparency issue discussed it with senior management and/or changed their practices regarding rebates and bonuses. One ANA member interviewed for the research indicated that the report was extremely helpful in negotiating a contract for a new agency relationship. Another shared that the report created a dialogue with the agency CEO, where choices were discussed and contract language was revised.

5. Accenture Tops Global M&A Report, Beating WPP

Accenture took the top spot in R3's global M&A League Report for August, a first for the consultancy since the monthly reviews started being released four years ago.

Last month, Accenture made eight acquisitions, including SinnerSchrader, Kunstmaan, The Monkeys + MAUD, Media Hive, Intrepid, Clearhead, Brand Learning and Wire Stone, collectively valued at $671 million, according to the report. R3 reviews all public sources of M&A news across marketing and media for the reports and assumes full sale amounts of the acquisitions regardless of earnout terms.

6. Unilever Finds Startups Can Replace Some Agency Tasks

While consulting firms are usually eyed as the most clear and present danger to agencies, don’t sleep on scrappy startup tech firms.

Unilever, one of the world’s largest marketers, is briefing startups on the tasks previously handled by the agencies it has axed in recent months as part of its ongoing efforts to limit agency and production fees.

The advertiser slashed its spend on agencies by 17 percent in the first half of 2017, while simultaneously making more moves to get closer to entrepreneurs. Over the last six months, it has launched co-working spaces in Singapore and Ireland where its marketers can sit beside up to 50 startups, with plans to erect more throughout the U.S., Europe and Asia. In these hubs, both Unilever’s marketers and startups work on live briefs, while the latter also have access to networking opportunities such as fireside chats and mentoring programs.

7. Martin Sorrell Fights Against the Rise of Short Term Thinking

WPP’s stock is down. And the company’s longstanding chief, Martin Sorrell, isn’t sure if the holding company can do anything about the factors putting pressure on its business.

Sorrell sees packaged goods companies not only cutting marketing spend they should be investing in their brands, but under attack by Amazon. By creating its own house brands, which it in turn distributes, it threatens to disintermediate WPP’s packaged-goods clients.


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