Phil's Blog

Where the money is.

When asked why he robbed banks, Willie Sutton famously responded: "Because that's where the money is."

Today, finding sizable clients is a challenge. Winning them is not just harder, it's often not what the winner expected. Clients embellish.

Ad agencies (and PR firms) have always embellished their abilities, experience, influence and size. And embellish is a kind word, believe me.

Nevertheless, the shock agencies experience when actual client budgets are disclosed (after the win) is significant. (Agencies have told me: "They lied.") Considering the investment in new business pitching plus promises made during the agency search process, what' an agency to do?

As the tech crowd says, there are solutions. For good ones, call me. I can help.

Phil

If Bankers Aren't Extending Credit, Why Should You?

If I had a nickel for every time an agency told me some clients haven't paid them for months, I wouldn't be earning my keep. I work for more than nickels and I usually get paid the day service is rendered.

That may be the luxury of a consultancy. Still I am somewhat amazed by how long ad agencies and other service companies will extend and re-extend credit to their clients because of the fear of losing those clients.

While I understand the optimism that things will get better for those clients, isn't is better to allow your company to simply get smaller now, rather than allowing your clients to cause it later, leaving you with debt?

The US government has forceably funded both struggling and non-struggling banks. Today, banks can borrow at virtually no interest then turn around and earn a guaranteed two percent or more on Treasury bills. Despite the government's goal of reopening the flow of credit, the banks are not loaning money. So why should you?

Since you've already cut back bonuses, salaries and people two or three times, why not face up to failing clients who just might pull you under?

Phil

Feckless

Psst!

Mismanaging an ad agency's future by ignoring changes in media and markets is its own punishment. 

I can name three advertising agencies in the South that are so set in their ways that no client that I ever represent will ever hire them. 

Hold on. I'm not being nasty or snippy. I neither vote in nor decide the agency reviews I conduct. My clients do. I am simply pointing out here, in a forum where the agencies' identities won't be revealed, that being feckless is not a strategy for success.

Phil

Toy Strategies For Real Challenges

Two of the largest national toy retailers have announced (and begun) their holiday promotions.

Wal-Mart is repeating a program they started last year -- "100 Toys for $10." Instead of using the traditional strategy of lowering prices on what toy companies call the staples, they are lowering the prices on some well-known brands of toys (i.e., Barbie, LEGOs, etc.) to draw in customers hoping they'll buy the staples at full price. 

Toys R Us is going express. They're opening Toys R Us Express (280 locations) in vacant spaces of malls and shopping centers just for the holiday season. This saves on year-around staffing and overhead while focusing on this critical sales period. With about 250 toys per "pop up" location, they'll all be closed by mid-January.

They're also opening Holiday Express (60) areas within current Babies R Us stores. 

This Express or Pop Up strategy is often used by Halloween retailers. They take over vacant space or share space with retailers who aren't doing so well. Once Halloween is over, they're gone. 

Seems to me the strategy will become more prevalent in this Great Compression we're in. However, it isn't exactly new. Years ago, there were Marts that had dealers with seasonal items for sale. It was all based on quick opportunities to make a buck.

Phil

Phil's List of Enlightening Stats - Part 88

6.3 - Number of years that US life expectancy increased during the Great Depression.

25 percent - Average portion of annual sales represented by the holiday period for retailers. Last year, that figure was just 18 percent of their annual sales.

8 - Number of years the United States has been fighting in Afghanistan. 779 American soldiers have been killed in the war. $223 billion has been spent by the US on the war. Today is the first day of the 9th year.

21.8 million - Number of viewers of the Minnesota Vikings (with 39 year old quarterback, Brett Favre) vs Green Bay game this past Monday night on ESPN. That is the largest audience to ever watch a program on cable television beating the prior record by 3 million viewers.

5.3 percent - Decline in online advertising spending in the first half of 2009.

Killer Creative

The most commonly used word in advertising agency presentations is: Creative.

In fact, the word occupies a place in almost every paragraph of RFQ/RFP responses, advertising/design firm promotional pieces and every page of their Web sites. 

And it has become as meaningless as the word Solution in the tech world.

Perhaps then, it isn't any wonder that the most common verb used to describe the production of creative is: Execute.

Phil

Odds and Ends, Literally

Here are a few things that from my recent reviews that I found quite odd. And they helped guarantee that the agency doing them didn't win.

• About halfway into their presentation, one agency brought in a string quartet to play. While I cannot reveal their reason (which related to the client's product), it quickly became uncomfortable for almost everyone.
• Twice I have seen agencies order pizza at the beginning of their pitches promising to end when the pizza arrived. In each case, they were right; the pizza arrived at "the end."
• Please no a cappella either. One agency's presenters formed a sorta barbershop quartet and sang. Sadly for them, there was no harmony.

These are not the only odd occurrences. I'll tell some more stories in coming weeks. Like the one where the agency used water balloons...

Phil

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Ad Age: Undermining Advertising Since 1930

"Life shrinks or expands in proportion to one's courage." - Anais Nin

Most adages teach us something positive. Not Ad Age which over the years has helped turn advertising into a commodity more than any officer in an advertising holding company ever could. 

This post isn't going to be a love mark for the Crain publication. They've supported the mergers and acquisitions of thirty years that lead to a lack of confidence in advertising by agencies themselves and, as a result, advertisers. They've promulgated their drivel with guys like Al Ries (of the 'iPhone will fail' fame), Bob Garfield (a toxic anti-capitalist) and a front man named Rance Crain who could win the Pulitzer Prize for Destructive Boredom if there were such a thing.

Today, for example, Ad Age tells us that Crispin Porter + Bogusky hasn't helped Burger King surpass McDonald's in the five years it has handled the entire account suggesting therefore that it has failed. Ad Age is once again trying to eat its young.

Make up your minds, boys. Can advertising be effective or not? Never mind answering. You've made clear your views.

Closing adage acronym: TANSTAAFL ("There ain't no such thing as a free lunch." - Robert Heinlien)

In a recent agency review, I am absolutely certain that none of the agencies participating in the review ever heard the word. The word I am referring to is a verb. It refers to one thing none of the agencies did. In fact, few agencies do it. That word is

rehearse.